Viking Supporters Co-operative
Viking Chat => Off Topic => Topic started by: tyke1962 on August 02, 2022, 05:40:45 pm
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Seems to be gathering some pace does this movement .
If anyone's not heard of them I've provided a link .
https://metro.co.uk/2022/07/03/dont-pay-uk-the-movement-asking-you-to-stop-paying-energy-bills-16899197/?ito=article.tablet.share.top.link
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A lot of folk won't be able to pay, so arrears are going to go through the roof.
Shaping up like a modern poll tax disaster in the making, but no sign any of the politicians have any gumption to stop it dead by refusing to allow Ofgem to increase prices.
In the background, the government are preparing a new procurement initiative for net zero, having been ruled inadequate in court;
https://twitter.com/adamvaughan_uk/status/1554474514020450309?cxt=HHwWioCyybSVzZIrAAAA
Remember the PPE scandal....here we go again!
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Suppose it helps the rest of us out with lower prices when the rest get cut off.....
I'm not sure of the merits of don't like the price then take it and don't pay.
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I'd love to be part of this, but would the energy companies be ruthless enough to cut us all off?
Any suggestions from Truss or Keith about what can be done about it all?
No, I thought not.
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SS
Labour proposed a windfall tax on the energy companies months ago.
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SS
Labour proposed a windfall tax on the energy companies months ago.
Surely that's just a blight on their obscene profits. Would it make them reduce all our bills?
No, it'd probably induce them to put them up even more.
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SS
Labour proposed a windfall tax on the energy companies months ago.
Surely that's just a blight on their obscene profits. Would it make them reduce all our bills?
No, it'd probably induce them to put them up even more.
Tax is the process of the Govt taking money from certain private individuals or organisations.
The Govt then has money to give to other individuals.
BP has just "made a profit" (read: "to a great extent, benefited from a massive increase in oil and gas prices that are nothing to do with BP's own efforts." The profit is about £8bn over three months. If the Govt took 3/4 of that as a windfall tax, that would be enough to cover the increase in energy bills of the poorest 1/4 of the population.
It's entirely doable. It just requires political will. You're not going to get the Tories doing that. Labour said months ago it would do something of that sort.
But yeah, they're all the same...
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
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SS
Labour proposed a windfall tax on the energy companies months ago.
Surely that's just a blight on their obscene profits. Would it make them reduce all our bills?
No, it'd probably induce them to put them up even more.
Tax is the process of the Govt taking money from certain private individuals or organisations.
The Govt then has money to give to other individuals.
BP has just "made a profit" (read: "to a great extent, benefited from a massive increase in oil and gas prices that are nothing to do with BP's own efforts." The profit is about £8bn over three months. If the Govt took 3/4 of that as a windfall tax, that would be enough to cover the increase in energy bills of the poorest 1/4 of the population.
It's entirely doable. It just requires political will. You're not going to get the Tories doing that. Labour said months ago it would do something of that sort.
But yeah, they're all the same...
I thought you said that an opposition party wouldn’t set out what they would do two years in advance of a GE.
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Martin Lewis is on it .
https://youtu.be/TduXDfBzfgw
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BST,
A windfall tax misses the point by a country mile.
It is a very unintelligent way to address fuel poverty issues.
Allowing prices to increase way above inflation sets a new level for energy costs across the whole economy.
This replicates in higher costs for all products depending upon high energy inputs.
Paying a compensation for higher energy bills to consumers does not capture the wider inflationary impact.
Food costs will see large increases on the back of high energy costs, so those with low levels of disposable income suffer through all transactions.
We covered this in an earlier thread, but the ability to defer any windfall liability via investment in fossil fuel extraction at 91p in the £ means that it is essentially avoidable, and will raise a much lower sum than any profit boost from increasing consumer prices. These excess profits will find a way into shareholder dividends and share buybacks.
Do you imagine that prices will reduce for consumers in the future from the higher level?
Just prevent the price increase in the first place.
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SS
Labour proposed a windfall tax on the energy companies months ago.
Surely that's just a blight on their obscene profits. Would it make them reduce all our bills?
No, it'd probably induce them to put them up even more.
Tax is the process of the Govt taking money from certain private individuals or organisations.
The Govt then has money to give to other individuals.
BP has just "made a profit" (read: "to a great extent, benefited from a massive increase in oil and gas prices that are nothing to do with BP's own efforts." The profit is about £8bn over three months. If the Govt took 3/4 of that as a windfall tax, that would be enough to cover the increase in energy bills of the poorest 1/4 of the population.
It's entirely doable. It just requires political will. You're not going to get the Tories doing that. Labour said months ago it would do something of that sort.
But yeah, they're all the same...
And what about the other 3/4 of the population?
Come on, you know it's just lip service. We all know, you included, that the whole of this horror show needs to be taken into public ownership. Keith knows it as well, and endorsed it, but then, spineless as he is, reneged on it.
Yes, this current crop are all the same. There'll be little choice for anyone in 2 years time.
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Albie.
Run it by me how you stop the increase in the price of gas on the global markets by nationalisation.
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The Don't Pay action doesn't surprise me. As Albie mentions, the Poll Tax offers a precedent and mass non-payment would leave the energy companies with a huge headache. Cutting off thousands of pensioners in mid-winter? Not a good look.
The Government can't say they haven't been warned. Think about the political capital that Starmer and others could reap in a year's time by proposing to put the CMA on the energy companies with a view to breaking up the wholesale oligopoly and also by reinvigorating the regulatory body. Who among the electorate would object?
Big energy should be very concerned about the bad rep that it's going to get for this. The energy sector should be demanding government action as a way of protecting itself from public opprobrium and the risk of being the butt of endless jokes about corporate greed. Just look at what that did for the banking sector...
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Big h as bst says you can't change the world markets. If you want to hit these guys it is through taxing them.
What we do by not paying our providers is hit them, not the people making the big money (which isn't our providers).
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Albie.
Run it by me how you stop the increase in the price of gas on the global markets by nationalisation.
Isn't it the case that a nationalised energy industry could simply stop increases. So they would still be buying the fuel at high cost, but that can be covered partially by taxing certain companies as well as government borrowing.
The cost of the borrowing would partly be covered by the economy being in a better state with the inflationary effect of high cost fuel neutralised. They could also sort out the Ukraine crisis rather than "fueling" it as is current.
Then bring in Universal Basic Income and the economy would flourish.
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.... and the risk of being the butt of endless jokes about corporate greed. Just look at what that did for the banking sector...
I'm not sure that the energy industry moghuls are any more bothered about being the butt of jokes any more than bankers are. I'm sure they're more focused on buying their next car, installing a bigger swimming pool, buying property in Los Angeles, and ensuring their bit on the side is kept happy and won't rock the family boat.
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This is correct, BRR (post16)
Albie.
Run it by me how you stop the increase in the price of gas on the global markets by nationalisation.
Isn't it the case that a nationalised energy industry could simply stop increases. So they would still be buying the fuel at high cost, but that can be covered partially by taxing certain companies as well as government borrowing.
The cost of the borrowing would partly be covered by the economy being in a better state with the inflationary effect of high cost fuel neutralised. They could also sort out the Ukraine crisis rather than "fueling" it as is current.
Then bring in Universal Basic Income and the economy would flourish.
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The French have limited price rises in energy to 4% with the sector largely in public ownership.
The point BST raises about gas prices is addressed by reducing dependence on imported gas bought on spot markets. Recommissioning Rough as a storage facility (owned by Centrica) would help short term, but electrifying some current gas uses would be comparatively easy for the UK to do.
The wider energy problem is electricity prices being tied to the cost of gas in the UK.
Break that chain, and then with the Dogger Bank windfarm on stream, the UK is set to be a net exporter of electricity via the interconnectors to Europe.
Blaming the whole crisis solely on the wholesale price of gas is just a distraction ploy.
Yes, it has happened, but we have the tools in the box to prevent serious harm....that harm is not being prevented by simply cranking up the bills for working people.
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Big h as bst says you can't change the world markets. If you want to hit these guys it is through taxing them.
What we do by not paying our providers is hit them, not the people making the big money (which isn't our providers).
BFYP, your comment misses the point. The point is about protecting the consumer. Taxing surplus/excess profits is shutting the stable door after the horse has bolted. And in the meantime the fact we have a p*ss-weak regulator means that we all have to dance to the energy companies' tune.
But there are ways of dealing with this; think about how the UK Govt supported the banking sector in 2008 when global liquidity dried up. If UK consumers had been forced to shoulder the burden then, mortgage holders would have been paying annual interest rates of 30%+.
This crisis does not have to be entirely shouldered by the consumer. There are other options but we have a government that is steadfastly ignoring them.
That's my point.
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
Good for them. A water company can't cut you off. Gas and Electric can - after a court order - but Water can't.
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.... and the risk of being the butt of endless jokes about corporate greed. Just look at what that did for the banking sector...
I'm not sure that the energy industry moghuls are any more bothered about being the butt of jokes any more than bankers are. I'm sure they're more focused on buying their next car, installing a bigger swimming pool, buying property in Los Angeles, and ensuring their bit on the side is kept happy and won't rock the family boat.
I'm not sure they are too. But when their shareholders see the stock price fall by 50% and the gravy train come to a juddering halt then they'll be off like a bride's nightie.
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Martin Lewis is on it .
https://youtu.be/TduXDfBzfgw
Yes he was talking about it on tv and the radio the other week. He said he is expecting big protests this autumn with people not paying their bills.
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Tweet from Emily Gosden of the Times, on the BP profits windfall;
"Some BP numbers:
$3.5 billion = how much it's spending buying back its own shares this quarter
$2.5 billion = how much it plans to spend on low carbon energy globally over the entire year
$361 million = how much it actually spent on low carbon energy in the first half of 2022"
Priorities, eh!
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Seems to be gathering some pace does this movement .
If anyone's not heard of them I've provided a link .
https://metro.co.uk/2022/07/03/dont-pay-uk-the-movement-asking-you-to-stop-paying-energy-bills-16899197/?ito=article.tablet.share.top.link
I take it none of them know that the power companies are able to get warrants to be able to force entry to premises with unpaid debts and install pay meters.
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
Good for them. A water company can't cut you off. Gas and Electric can - after a court order - but Water can't.
I would think that there wil be plenty of people who would be worried that if they don’t pay their energy bills that it could affect their credit rating which might hinder them in future years.
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
Why are they doing that when water companies don't have the authority to turn off a domestic water supply, even when there is an outstanding debt at the property?
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Energy retailers have been going bust for some time and the government have acted in slow motion in that time. Windfall tax has been slagged off by the government as it would affect investment (or more likely because it was a labour proposal) since then they have:
''July 11 (Reuters) - British lawmakers approved a 25% windfall tax on oil and gas producers in the British North Sea on Monday, which the government says will raise 5 billion pounds ($5.95 billion) in one year to help people struggling with soaring energy bills.''
https://www.reuters.com/world/uk/uk-lawmakers-approve-windfall-tax-oil-gas-producers-2022-07-11/#:~:text=July%2011%20(Reuters)%20%2D%20British,struggling%20with%20soaring%20energy%20bills.
But they refuse to call it a windfall tax ................ and since of course understanding the huge gains they were to about to announce BP said this windfall tax would not affect investment.
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show of hands, who is not going to pay their bills?
Is there an anarchist in the house?
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This is the organisation
https://dontpay.uk/
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The UK has significant supplies of both oil and gas (we were a next exporter of oil in 2020). Thus if the government wished it coud reduce the cost of UK produced oil and gas to UK suppliers and thus UK consumers.
It wont because:
a) it benefits from higher prices in tax and VAT
b) a significan number of individuals connected with government have links with the oil/gas industry (LIz Truss for instance worked for Shell for 4 years)
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I can't get my head around this. If gas is dearer in the global markets, how are they making so much money?
They are either charging us a hell of a lot more than they should to cover the rise or the price has fallen and they haven't passed that on yet.
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
Why are they doing that when water companies don't have the authority to turn off a domestic water supply, even when there is an outstanding debt at the property?
I'm guessing that if you are on a Meter you will be racking up a Bill which you would be liable to pay
If you stop using water the Meter would show you didn't owe them anything.
However 2 things spring to mind ... There would be a standing charge of course and if you are not close to a "tap" when collecting water it will be a fight pain in the a**e
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I can't get my head around this. If gas is dearer in the global markets, how are they making so much money?
They are either charging us a hell of a lot more than they should to cover the rise or the price has fallen and they haven't passed that on yet.
Because BP's primary activity is extracting oil and gas from the ground.
That's not costing them any more than it did 12 months ago. But for reasons entirely out of their influence, the price of their products has exploded.
So their profits have gone to obscene levels. Not through any major innovation they have introduced. Through a breakdown in the global supply-demand dynamics.
That is the dictionary definition of an economic windfall. It's one way that capitalism can stop working properly. The standard approach to that is for Govt to step in, confiscate the excess profit via a tax, and redistribute that money to people or companies that are being hammered by the market dysfunction.
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I would hazard a guess hound that the people trying to get this off the ground will be able to afford their fuel and will not be affected by the high cost
As you point out this could be a dangerous game that could backfire and affect peoples lives for a long time
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This is correct, BRR (post16)Albie.
Run it by me how you stop the increase in the price of gas on the global markets by nationalisation.
Isn't it the case that a nationalised energy industry could simply stop increases. So they would still be buying the fuel at high cost, but that can be covered partially by taxing certain companies as well as government borrowing.
The cost of the borrowing would partly be covered by the economy being in a better state with the inflationary effect of high cost fuel neutralised. They could also sort out the Ukraine crisis rather than "fueling" it as is current.
Then bring in Universal Basic Income and the economy would flourish.
.
The French have limited price rises in energy to 4% with the sector largely in public ownership.
The point BST raises about gas prices is addressed by reducing dependence on imported gas bought on spot markets. Recommissioning Rough as a storage facility (owned by Centrica) would help short term, but electrifying some current gas uses would be comparatively easy for the UK to do.
The wider energy problem is electricity prices being tied to the cost of gas in the UK.
Break that chain, and then with the Dogger Bank windfarm on stream, the UK is set to be a net exporter of electricity via the interconnectors to Europe.
Blaming the whole crisis solely on the wholesale price of gas is just a distraction ploy.
Yes, it has happened, but we have the tools in the box to prevent serious harm....that harm is not being prevented by simply cranking up the bills for working people.
The basic core of the problem is that we in Britain currently rely excessively on gas, and there is a global shortage of the supply of gas compared to the demand for it.
Immediately, in the current crisis over the next 6 months or so, everything else is secondary.
You are muddling up long term issues of our energy mix with the short term price crisis.
I entirely agree that we shouldn't be where we are now. But we are. So arguing about that won't help.
I also entirely agree that we should be reliant far less on gas in the future, and far more on other sources. But that's going to take years to effect. So arguing about that now won't help the current crisis.
At core, the problem is that we want to use a certain amount of gas, but on the world markets, that gas is 2-3 times the cost it was 12 months ago. So someone has to pay for that. There's no getting round that.
You COULD deal with that by nationalising all the energy supply companies. But the Govt would still have to pay global prices for gas. If the Govt didn't pass those costs onto consumers, because it kept the costs down, that's fine. It would mean Govt borrowing or increased taxes elsewhere to pay for that, but I'd be cool with that.
But that is absolutely not the only way to protect consumers of energy.
The other way is to allow the market to set the price, then subsidise consumers by giving them money to cover those higher costs. Govt could do that by raising taxes elsewhere or by borrowing.
The overall effect on suppliers, consumers and Govt finances is identical in both cases.
You're muddying the waters by saying that only nationalisation can solve the immediate crisis.
By the way, France is massively insulated from global gas prices because it uses half the amount of gas per head than we do. Predominantly because they lean so heavily on nuclear power to produce so much of their energy needs. A policy that you disagree with.
Which way do you want it?
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I’m trying to build a substantial credit balance during these summer months by making extra payments when I can, currently £250 in credit but expect that to be wiped out within a couple of months during winter
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I’m trying to build a substantial credit balance during these summer months by making extra payments when I can, currently £250 in credit but expect that to be wiped out within a couple of months during winter
Much the same and bizarrely soon I may reach a tipping point where it's cheaper to run my car on petrol than electric, which is frankly daft.
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.... and the risk of being the butt of endless jokes about corporate greed. Just look at what that did for the banking sector...
I'm not sure that the energy industry moghuls are any more bothered about being the butt of jokes any more than bankers are. I'm sure they're more focused on buying their next car, installing a bigger swimming pool, buying property in Los Angeles, and ensuring their bit on the side is kept happy and won't rock the family boat.
I'm not sure they are too. But when their shareholders see the stock price fall by 50% and the gravy train come to a juddering halt then they'll be off like a bride's nightie.
Don't forget that most shareholders are people like us, people with private pensions etc.
Another good point made in this thread, default on your bills purposefully and kiss goodbye to mortgages, credit cards, new bank accounts, car finance etc. Not to mention in some professions your career. Anyone who does it should think very carefully of the consequences.
I don't think anyone doubts something should be done as it's too much for many to afford, clearly the profits of BP etc are excessive and they have to contribute albeit with incentives to invest alongside that. I don't think returning money to investors is quite the right action in this case, for others it is but I don't think oil producers ever really suffer.
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My energy supplier wanted £300 a month in direct debit payments.
I've cancelled that and will pay monthly for what I use, currently using around £150.
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The UK has significant supplies of both oil and gas (we were a next exporter of oil in 2020). Thus if the government wished it coud reduce the cost of UK produced oil and gas to UK suppliers and thus UK consumers.
It wont because:
a) it benefits from higher prices in tax and VAT
b) a significan number of individuals connected with government have links with the oil/gas industry (LIz Truss for instance worked for Shell for 4 years)
Hydrocarbon Fuel Duty is NOT an ad valorem tax.
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My energy supplier wanted £300 a month in direct debit payments.
I've cancelled that and will pay monthly for what I use, currently using around £150.
Great for summer when usage drops down a lot, but you'll probably use a lot more than the average in winter. Can you pay over £300 of usage per month then?
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My energy supplier wanted £300 a month in direct debit payments.
I've cancelled that and will pay monthly for what I use, currently using around £150.
Great for summer when usage drops down a lot, but you'll probably use a lot more than the average in winter. Can you pay over £300 of usage per month then?
Got three wood burners in my house and around 3 ton of wood. Hopefully won't go up too much
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There is a movement were people are not paying their water bills already and queuing at public taps to fill up with water ,search online
Why are they doing that when water companies don't have the authority to turn off a domestic water supply, even when there is an outstanding debt at the property?
I'm guessing that if you are on a Meter you will be racking up a Bill which you would be liable to pay
If you stop using water the Meter would show you didn't owe them anything.
However 2 things spring to mind ... There would be a standing charge of course and if you are not close to a "tap" when collecting water it will be a fight pain in the a**e
Although all new builds have water meters, not all properties have water meters. Some properties are impossible to install meters into, and there are also big properties that have been subdivided into flats etc. that are difficult to have meters in each subdivision.
A meter isn't always the best value way of paying for water anyway - a good rule of thumb is that if there are only one or two people living at the property a meter is cheaper, but more than three people living there is cheaper on flat-rate water rates if they're still available at that property.
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BST,
There are so many basic mistakes in your view of energy markets,it is difficult to know where to start.
You seem to be content with higher prices to UK consumers being funnelled into share buybacks by the likes of BP, as long as government gives a one-off sweetener to lessen the burden.
1)
"But that is absolutely not the only way to protect consumers of energy.
The other way is to allow the market to set the price, then subsidise consumers by giving them money to cover those higher costs. Govt could do that by raising taxes elsewhere or by borrowing.
The overall effect on suppliers, consumers and Govt finances is identical in both cases."
This is complete nonsense.
Consumers of energy are NOT one group with similar profiles and concerns.
How does this protect industrial and commercial energy users?.....There are likely to be significant closures of businesses unable to pass on costs in full, or vulnerable to demand reductions on the basis of marginal price increases.
Far from being an identical impact on all sectors, it is very different for each.
The impact on Govt finances, for example, will depend on the tax income from reduced economic activity.
2)
"You're muddying the waters by saying that only nationalisation can solve the immediate crisis."
No, I am saying that nationalisation can only resolve the crisis over time, because you need to have control over energy infrastructure provision.
3)
"You are muddling up long term issues of our energy mix with the short term price crisis."
Wrong...they are not separate problems.
How you respond to the price rise on international spot markets will have a knock on effect on the choices you make going forwards. As long as the UK locks electricity prices in step with gas high energy costs are baked into the economy.
The issue is whether you add to the problem by allowing prices to rise, only to face further stress from increases every 6 months.
This is not a one-off excess profit windfall, it is a stepped increase in imported gas prices which will continue with supply restrictions.
Windfall taxes every 6 months make no sense at all, having failed to prevent the price rise and absorbed it into the national tax base.
4)
"I also entirely agree that we should be reliant far less on gas in the future, and far more on other sources. But that's going to take years to effect."
It is important for the climate breakdown that it does not "take years to take effect". There is no good reason why it should take years to change the balance of supply to electricity as the primary source.
Under the current system, electricity suppliers will choose to sell on international markets if the price is higher.
The UK could be selling leccy from Dogger Bank to maximise returns, not to reduce fuel poverty in the UK.
"You COULD deal with that by nationalising all the energy supply companies."
It is NOT just a matter of energy supply companies, it is also a matter of energy production infrastructure.
5)
"By the way, France is massively insulated from global gas prices because it uses half the amount of gas per head than we do. Predominantly because they lean so heavily on nuclear power to produce so much of their energy needs. A policy that you disagree with."
France is in a better position because it is further forward in electrification.
Historically, that is because of nuclear, but that would not be the most cost effective way to electrify from the options today.
A high proportion of French nuclear is offline nowadays as the industry struggles to maintain available capacity.
The question is how quickly the UK can electrify, and what is the production method best suited to that transition.
Offshore wind beats new nuclear by any metric of time and cost....no-one in their right mind would commission new nuclear (lead time over 15 years) to deliver a quick transition.
As I said in the earlier post, just prevent the price increase in the first place.
From that base, the UK needs to reform the whole energy sector to address the contribution of energy to climate change.
If you allow Ofgem to raise the cap, the impacts will be massively detrimental across the UK economy.
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My energy supplier wanted £300 a month in direct debit payments.
I've cancelled that and will pay monthly for what I use, currently using around £150.
Great for summer when usage drops down a lot, but you'll probably use a lot more than the average in winter. Can you pay over £300 of usage per month then?
Got three wood burners in my house and around 3 ton of wood. Hopefully won't go up too much
Isn't the £300 a month based upon your previous annual energy usage though, including the use of your woodburners to lower it?
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The UK has significant supplies of both oil and gas (we were a next exporter of oil in 2020). Thus if the government wished it coud reduce the cost of UK produced oil and gas to UK suppliers and thus UK consumers.
It wont because:
a) it benefits from higher prices in tax and VAT
b) a significan number of individuals connected with government have links with the oil/gas industry (LIz Truss for instance worked for Shell for 4 years)
Hydrocarbon Fuel Duty is NOT an ad valorem tax.
I am clearly taking about tax on the oil and gas extraction companies. They pay 30% Corporation Tax on sale of their products - higher the price - higher the tax.
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I'm sorry but it wasn't clear at all.
Especially as Corporation Tax isn't levied on sales at all.
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My energy supplier wanted £300 a month in direct debit payments.
I've cancelled that and will pay monthly for what I use, currently using around £150.
Great for summer when usage drops down a lot, but you'll probably use a lot more than the average in winter. Can you pay over £300 of usage per month then?
Got three wood burners in my house and around 3 ton of wood. Hopefully won't go up too much
Isn't the £300 a month based upon your previous annual energy usage though, including the use of your woodburners to lower it?
Not sure, we'll see in the winter. Gonna be a shock for everyone though.
They did quote us £6,500 for fixed and £3,700 variable.
Plus the third wood burner is going in later on this month so was only running two last year
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BST,
There are so many basic mistakes in your view of energy markets,it is difficult to know where to start.
You seem to be content with higher prices to UK consumers being funnelled into share buybacks by the likes of BP, as long as government gives a one-off sweetener to lessen the burden.
1)
"But that is absolutely not the only way to protect consumers of energy.
The other way is to allow the market to set the price, then subsidise consumers by giving them money to cover those higher costs. Govt could do that by raising taxes elsewhere or by borrowing.
The overall effect on suppliers, consumers and Govt finances is identical in both cases."
This is complete nonsense.
Consumers of energy are NOT one group with similar profiles and concerns.
How does this protect industrial and commercial energy users?.....There are likely to be significant closures of businesses unable to pass on costs in full, or vulnerable to demand reductions on the basis of marginal price increases.
Far from being an identical impact on all sectors, it is very different for each.
The impact on Govt finances, for example, will depend on the tax income from reduced economic activity.
2)
"You're muddying the waters by saying that only nationalisation can solve the immediate crisis."
No, I am saying that nationalisation can only resolve the crisis over time, because you need to have control over energy infrastructure provision.
3)
"You are muddling up long term issues of our energy mix with the short term price crisis."
Wrong...they are not separate problems.
How you respond to the price rise on international spot markets will have a knock on effect on the choices you make going forwards. As long as the UK locks electricity prices in step with gas high energy costs are baked into the economy.
The issue is whether you add to the problem by allowing prices to rise, only to face further stress from increases every 6 months.
This is not a one-off excess profit windfall, it is a stepped increase in imported gas prices which will continue with supply restrictions.
Windfall taxes every 6 months make no sense at all, having failed to prevent the price rise and absorbed it into the national tax base.
4)
"I also entirely agree that we should be reliant far less on gas in the future, and far more on other sources. But that's going to take years to effect."
It is important for the climate breakdown that it does not "take years to take effect". There is no good reason why it should take years to change the balance of supply to electricity as the primary source.
Under the current system, electricity suppliers will choose to sell on international markets if the price is higher.
The UK could be selling leccy from Dogger Bank to maximise returns, not to reduce fuel poverty in the UK.
"You COULD deal with that by nationalising all the energy supply companies."
It is NOT just a matter of energy supply companies, it is also a matter of energy production infrastructure.
5)
"By the way, France is massively insulated from global gas prices because it uses half the amount of gas per head than we do. Predominantly because they lean so heavily on nuclear power to produce so much of their energy needs. A policy that you disagree with."
France is in a better position because it is further forward in electrification.
Historically, that is because of nuclear, but that would not be the most cost effective way to electrify from the options today.
A high proportion of French nuclear is offline nowadays as the industry struggles to maintain available capacity.
The question is how quickly the UK can electrify, and what is the production method best suited to that transition.
Offshore wind beats new nuclear by any metric of time and cost....no-one in their right mind would commission new nuclear (lead time over 15 years) to deliver a quick transition.
As I said in the earlier post, just prevent the price increase in the first place.
From that base, the UK needs to reform the whole energy sector to address the contribution of energy to climate change.
If you allow Ofgem to raise the cap, the impacts will be massively detrimental across the UK economy.
Albie.
I gave up at your first point. Where on earth do you get the idea that I'm happy with BP pouring their obscene profits into shareholders' pockets?
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The companies lost money last year and nobody on here were promoting nationalisation of companies in the oil and gas industries, some thought it was progress towards a carbon free utopia.
Some were wanting them closed down because of their part in pollution who now want the companies nationalised, will they want the cost of closing the oil and gas fields when the emergency is over? which will not be soon now.
What would be the repercussions to the " don't pay movement" and their sympathisers if the same companies re directed all supply to the continent? who would suck it up like no tomorrow and pay the world price for their product.
What would be the repercussions if like Shell all the companies moved their tax revenue payments to the UK last year because it was more beneficial for their tax affairs to do so, all the companies moved abroad to other countries and the country lost Billions?
What would be the repercussions of pension firms losing revenue raised by investing in these firms?
Who thinks companies will sell products in the UK that they won't get paid for when there is a world wide market for that same product?
Some people are going to have to make their minds up, some who think they are highly principled people are going to have to make their minds up especially the save the world lot, reality has come twenty years too soon for them and the world they crave is staring them in the face until science overcomes the problems which it will but not in the 2030/50 timescale they crave.
PS. share tips buy debt collector companies and Auctioneers.
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I thought the rise in bills in June was meant to be 50%?
My bill has just gone up from £128.36 to £260.99. That's a rise of over 100%.
How much longer are we, the working class, going to put up with this?
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I thought the rise in bills in June was meant to be 50%?
My bill has just gone up from £128.36 to £260.99. That's a rise of over 100%.
How much longer are we, the working class, going to put up with this?
Have you come to the end of a deal and gone straight onto your supplier's standard tariff?
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I thought the rise in bills in June was meant to be 50%?
My bill has just gone up from £128.36 to £260.99. That's a rise of over 100%.
How much longer are we, the working class, going to put up with this?
Have you come to the end of a deal and gone straight onto your supplier's standard tariff?
Yes. In fact, they're also demanding £74 odd for what they call a final bill. They seem to be doing what they want.
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Have you tried looking for a new deal elsewhere?
They always stiff you when you go onto a standard tariff. But I don't know if there are any deals out there right now. Mine is due in two months.
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Have you tried looking for a new deal elsewhere?
They always stiff you when you go onto a standard tariff. But I don't know if there are any deals out there right now. Mine is due in two months.
Fixed deals are around double standard tariffs now
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As mentioned above one of the reasons that the government wont regulate the energy industry is it's closeness with it:
Dozens of former secretaries of state, ministers, heads of intelligence agencies, ambassadors and chiefs of the British military take advantage of a revolving door that allows them to work for corporations in a sector whose interests some have promoted while in office.
Former secretaries of state Sir Michael Fallon and Philip, now Lord, Hammond, are among the beneficiaries of a process which has been criticised for being at “the heart of how the British establishment survives and thrives across Whitehall”.
The exchange of personnel between government and energy firms goes both ways. Former staff of Anglo/Dutch oil giant Shell, who are also senior executives at large mining corporations, currently sit on the boards of the Ministry of Defence (MOD) and the Foreign, Commonwealth and Development Office (FCDO), playing a role in shaping UK foreign and military policies.
Full article here:
https://declassifieduk.org/revealed-dozens-of-uk-former-senior-officials-profit-from-fossil-fuel-corporations-rubber-stamped-by-whitehall-committee/
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The don’t pay movement is just promoting theft? Use gas an electric yet don’t pay for it.
What next?
Organised drive offs from the local bp?
Co ordinated trolley dash at the local Tesco?
If you refuse to pay, then switch it all off. Turn off your gas main. Switch off the fuse box.
Then call the supplier and re negotiate a price u can afford, Warning them you will change your payments if they don’t compromise.
I wonder if those behind this movement know what a CCJ is. And what happens to your credit score if you get one. They affect everything in the financial world. Getting car insurance or even a phone contract becomes difficult if you have one.
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Or who's going to pay for your front door when it's been smashed in to forcibly install a pay meter.
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Glyn,
8m people in the UK are predicted to be in fuel poverty with the coming increase in energy costs.
This is at the same time as the BoE says the UK will be in recession from Q4 this year through the whole of 2023, with inflation rising to 13%.
Many of those people will not be able to pay, so will choose food (itself rising in price) over heat.
So the issue is whether the private profiteers will go to court to prosecute non-payers.
The scale of non payment will make that very difficult, and the courts will be unable to cope.
The point of the "Don't Pay" campaign is to give a voice to those unable to pay, and put political pressure on this wretched government to prevent Ofgem raising the price cap.
These increases fall much more heavily on those with limited income, because they have less disposable income to spend.
The IMF produced this graphic, to show the difference between countries. The UK needs to move the two points closer together, and towards the left axis.....somewhere near the position in France.
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I thought the rise in bills in June was meant to be 50%?
My bill has just gone up from £128.36 to £260.99. That's a rise of over 100%.
How much longer are we, the working class, going to put up with this?
For as long as there is no credible alternative to the government we have. We need a nationalist government with the needs of the workers at heart.
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Glyn,
8m people in the UK are predicted to be in fuel poverty with the coming increase in energy costs.
This is at the same time as the BoE says the UK will be in recession from Q4 this year through the whole of 2023, with inflation rising to 13%.
Many of those people will not be able to pay, so will choose food (itself rising in price) over heat.
So the issue is whether the private profiteers will go to court to prosecute non-payers.
The scale of non payment will make that very difficult, and the courts will be unable to cope.
The point of the "Don't Pay" campaign is to give a voice to those unable to pay, and put political pressure on this wretched government to prevent Ofgem raising the price cap.
These increases fall much more heavily on those with limited income, because they have less disposable income to spend.
The IMF produced this graphic, to show the difference between countries. The UK needs to move the two points closer together, and towards the left axis.....somewhere near the position in France.
I know all this, but the 'Don't Pay' isn't telling people what I've been saying.
Colour me cynical, but a completely anonymous organisation with zero financial transparency begging for donations from those it supposedly champions smacks of one of Trump's grifting scams.
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I don't know who is running the campaign, Glyn....but I do understand why they might want to preserve their privacy on this.
My understanding is that they were looking for pledges to discontinue paying by direct debit, to be actioned in October.
There would be no need for any of this if the Tories or Labour were looking to protect the vulnerable from predatory energy providers, but they are not looking to do more than a partial offset.
If you have any proof that this is a scam, then please share it with us.
I have not seen any evidence of this.
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I don't know who is running the campaign, Glyn....but I do understand why they might want to preserve their privacy on this.
My understanding is that they were looking for pledges to discontinue paying by direct debit, to be actioned in October.
There would be no need for any of this if the Tories or Labour were looking to protect the vulnerable from predatory energy providers, but they are not looking to do more than a partial offset.
If you have any proof that this is a scam, then please share it with us.
I have not seen any evidence of this.
They are asking for donations. You have looked at their website asking for those donations, have you not? There is absolutely no way of knowing where your money is going, if it will be spent in they way they claim it will, or how much they have collected in total. It is completely opaque. I don't need to prove it's a scam, they need to prove it isn't as it has all the hallmarks of a classic one.
If I donate, how do I know my money is being used as they say it is. You talk about not having any evidence, what do you say to not having any evidence of that?
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If it is organised, and they don't pay, they will have the book thrown at them and some will have their whole lives ruined, organisations like this will not be tolerated by the establishment whose existence could be threatened, and total anarchy would result if they were allowed to be successful.
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The way I see it the best way for the many people who are simply not going to have enough money to pay their energy bills is to only pay what you can afford .
I'd also suggest that you need to keep your usage at your historical levels if you can .
Keep all your receipts , food shopping , petrol or any other purchases you need to make .
As long as you can account for every pound coming in and prove that your only expenses are justifiable I'd suggest there's absolutely nothing anyone can do .
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I agree it is opaque at the moment, Glyn....but that does not mean it is a scam.
People should not donate if you are worried about how that money will be spent.
I would expect an explanation of monies received and spent in due course, as with any organisation collecting funds.
Often, with a new set up, this information comes after a sum is reached.
A relevant concern is whether they have "legal personality", status as an organisation which may be subject to challenge.
You can still make the pledge to cancel direct debit in October.
This is the real objective, because it takes back the ability to spend on other things and defer the energy costs.
Allowing the energy companies to crank up bills without constraint is not in the interests of low income consumers, if it means that they have less flexibility in managing their money.
The "Don't Pay" campaign is one tactic to apply pressure to the political debate, others will emerge.
How do you move the UK from the very bad position in the IMF graphic to be comparable with other countries like France and Sweden?......windfall taxes will not do that!
What action do you think those who cannot pay should take?
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If it is organised, and they don't pay, they will have the book thrown at them and some will have their whole lives ruined, organisations like this will not be tolerated by the establishment whose existence could be threatened, and total anarchy would result if they were allowed to be successful.
Whilst I somewhat agree, the picture you paint is one of only extremes and I don't think that is the case in the real world - ie not the world in the media nor in the minds/propaganda of the elite/establishment.
First, anarchy has tied to it so many emotive negatives including violence. As such it is thrown out as a rhetorical threat to not toeing the line of the establishment. Almost all will buy that.
In the real world, the not paying is just one focused act, not a general meltdown of all organisation in society. If it happens, it will punch a hole in the hold of the establisment. One hole, that is all. Where I agree with you is that the establishment won't allow this and will try to come down with full force on anyone involved, most significantly on the ones seen as "leading" it.
So, this IS war. And this is where the Labour Party for one should be very active, offering an alternative, a very radical alternative to the coming problem. AND meanwhile they should be acknowledging the motives and reasoning of the "don't pay". Some things are deeply important if not fully dealt with, and this is one. But we know the Labour Party is part of the establishment, so won't do this.
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If it is organised, and they don't pay, they will have the book thrown at them and some will have their whole lives ruined, organisations like this will not be tolerated by the establishment whose existence could be threatened, and total anarchy would result if they were allowed to be successful.
Whilst I somewhat agree, the picture you paint is one of only extremes and I don't think that is the case in the real world - ie not the world in the media nor in the minds/propaganda of the elite/establishment.
First, anarchy has tied to it so many emotive negatives including violence. As such it is thrown out as a rhetorical threat to not toeing the line of the establishment. Almost all will buy that.
In the real world, the not paying is just one focused act, not a general meltdown of all organisation in society. If it happens, it will punch a hole in the hold of the establisment. One hole, that is all. Where I agree with you is that the establishment won't allow this and will try to come down with full force on anyone involved, most significantly on the ones seen as "leading" it.
So, this IS war. And this is where the Labour Party for one should be very active, offering an alternative, a very radical alternative to the coming problem. AND meanwhile they should be acknowledging the motives and reasoning of the "don't pay". Some things are deeply important if not fully dealt with, and this is one. But we know the Labour Party is part of the establishment, so won't do this.
Regarding that last paragraph, BRR, the first thing that needs doing is for the Labour Party to get rid of that useless upper middle class prat that's supposed to be it's leader.
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If it is organised, and they don't pay, they will have the book thrown at them and some will have their whole lives ruined, organisations like this will not be tolerated by the establishment whose existence could be threatened, and total anarchy would result if they were allowed to be successful.
Whilst I somewhat agree, the picture you paint is one of only extremes and I don't think that is the case in the real world - ie not the world in the media nor in the minds/propaganda of the elite/establishment.
First, anarchy has tied to it so many emotive negatives including violence. As such it is thrown out as a rhetorical threat to not toeing the line of the establishment. Almost all will buy that.
In the real world, the not paying is just one focused act, not a general meltdown of all organisation in society. If it happens, it will punch a hole in the hold of the establisment. One hole, that is all. Where I agree with you is that the establishment won't allow this and will try to come down with full force on anyone involved, most significantly on the ones seen as "leading" it.
So, this IS war. And this is where the Labour Party for one should be very active, offering an alternative, a very radical alternative to the coming problem. AND meanwhile they should be acknowledging the motives and reasoning of the "don't pay". Some things are deeply important if not fully dealt with, and this is one. But we know the Labour Party is part of the establishment, so won't do this.
Regarding that last paragraph, BRR, the first thing that needs doing is for the Labour Party to get rid of that useless upper middle class prat that's supposed to be it's leader.
The best thing working class people can do Steve is to organise themselves through collectivism and fight their corner .
Whether that's is through joining trade unions or movements such as Dont Pay UK .
It's highly likely that even if Keith does somehow end up in number 10 the majority of today's issues won't simply be Laboured away .
Your just as likely to have just as many issues under a Labour government as you are a Tory one .
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I thought the rise in bills in June was meant to be 50%?
My bill has just gone up from £128.36 to £260.99. That's a rise of over 100%.
How much longer are we, the working class, going to put up with this?
For as long as there is no credible alternative to the government we have. We need a nationalist government with the needs of the workers at heart.
Like...?
Like a...National Socialist government?
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Last night on Sky News, almost all of the pundits and journalists were predicting that millions of people throughout the UK will be cancelling their direct debits, and opting to go back to paying quarterly bills, and offering what they can afford.
I doubt if the energy companies would be able to do much about that situation.
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I’m £245 in credit Shell energy sent me an email saying they had put my DD up to £200 from £150, I told them they couldn’t do that without my permission and they had not factored in the £400 that every household gets into their calculations, I said put it back to £150 and I’ll sort any shortfall if or when they arise
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Last night on Sky News, almost all of the pundits and journalists were predicting that millions of people throughout the UK will be cancelling their direct debits, and opting to go back to paying quarterly bills, and offering what they can afford.
I doubt if the energy companies would be able to do much about that situation.
energy company's will be fxxked come November and it will be done to pure greed and nothing else ,look at the bonuses the bosses are been paid it is ludicrous
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If it is organised, and they don't pay, they will have the book thrown at them and some will have their whole lives ruined, organisations like this will not be tolerated by the establishment whose existence could be threatened, and total anarchy would result if they were allowed to be successful.
Whilst I somewhat agree, the picture you paint is one of only extremes and I don't think that is the case in the real world - ie not the world in the media nor in the minds/propaganda of the elite/establishment.
First, anarchy has tied to it so many emotive negatives including violence. As such it is thrown out as a rhetorical threat to not toeing the line of the establishment. Almost all will buy that.
In the real world, the not paying is just one focused act, not a general meltdown of all organisation in society. If it happens, it will punch a hole in the hold of the establisment. One hole, that is all. Where I agree with you is that the establishment won't allow this and will try to come down with full force on anyone involved, most significantly on the ones seen as "leading" it.
So, this IS war. And this is where the Labour Party for one should be very active, offering an alternative, a very radical alternative to the coming problem. AND meanwhile they should be acknowledging the motives and reasoning of the "don't pay". Some things are deeply important if not fully dealt with, and this is one. But we know the Labour Party is part of the establishment, so won't do this.
That's exactly what happened with the Poll Tax. A mass non-payment movement allied with angry demonstrations - all organised outside exisiting political structures.
I wouldn't go looking for the Labour Party or any other mainstream political party to lead any sort of public dissent. When was the last time they organised people to do anything (other than campaign for themselves) Word War II?
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Interesting discussion on public ownership of energy on the Owen Jones Show on YT;
https://www.youtube.com/watch?v=lUSDYXcSe1k
Intro for the first 4and a half minutes.
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Looks like the unions are fed up with wetwipe Sir Keith, and started their own campaign;
https://twitter.com/eiecampaign/status/1556551243765514240
Missing in action, the Labour team!
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Looks like the unions are fed up with wetwipe Sir Keith, and started their own campaign;
https://twitter.com/eiecampaign/status/1556551243765514240
Missing in action, the Labour team!
How can labour support it, if they win the next election they have to implement it and they know that's tough?
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Pud,
Not sure what you think is tough.
The TUC produced a costed plan for public ownership of key utilities which was cheaper than not implementing it.
https://www.tuc.org.uk/news/tuc-publishes-plan-cut-bills-through-public-ownership-energy-retail
What about the idea of using the BULB customers as the base for a public sector energy provider, operating to a remit to lower consumer costs?
The big greed corps would need to price down to compete, or lose customers hand over fist.
Just one suggestion!
All the goals in the "Enough is Enough" programme are what Labour should be supporting anyway, but they just won't show any policies to be discussed.
https://inews.co.uk/news/new-union-and-mp-fronted-campaign-enough-is-enough-plans-to-hold-rallies-to-fight-cost-of-living-crisis-1784438
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Looks like the unions are fed up with wetwipe Sir Keith, and started their own campaign;
https://twitter.com/eiecampaign/status/1556551243765514240
Missing in action, the Labour team!
Done. I'm in, Albie.
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On energy bills.
The IMF has said today (quite correctly) that Govt subsidies to the price of energy is very much the wrong way to address this crisis.
You on the Left, listen to the whole argument before you automatically switch off.
The argument goes like this. The price of energy is now what it is. Nobody is fiddling it other than possibly small amounts at the margins. It is astronomically high at the moment because there is a global excess of demand over supply.
Unless you run a global command economy, where some global Govt dictates who can have what, the consequence of excess demand over supply is that prices go up.
That's what has happened.
What we need to do is to prioritise addressing that excess demand, and a major issue there is that we all need to use less energy. Turn the thermostat down a bit. Turn lights off. Don't use the washer for a half load. Etc. Etc.
Using Govt money to subsidise prices reduces the stick that should be making us use less energy.
And here's the moral issue. If we do that, WE will be OK. We rich countries could afford to subsidise prices that our own people pay. But that won't reduce the cost of energy on global markets. And the poorest countries will be the ones f**ked over if global demand continues to outstrip supply. Because their Govts cannot subsidise their domestic prices.
As the IMF says, the correct way for rich countries to deal with this crisis is 100% not to subsidise energy prices (which is what the TUC campaign wants). If you call for that, don't claim to be a socialist who cares about the poor of the developing world.
The correct way is for rich countries to allow the price to be what the global market determines it to be. Use that as a stick to encourage people to use less. And give big benefit subsidies to help people pay the bills. Predominantly targeted at the very poorest. The richer people will just have to tighten their belts.
Funny times we live in. The IMF being more internationally socialist than the TUC.
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This is the key piece from the IMF research paper by the way. A bit heavy going but it is very, very important.
https://mobile.twitter.com/Gilesyb/status/1556528548973879296
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On energy bills.
The IMF has said today (quite correctly) that Govt subsidies to the price of energy is very much the wrong way to address this crisis.
You on the Left, listen to the whole argument before you automatically switch off.
The argument goes like this. The price of energy is now what it is. Nobody is fiddling it other than possibly small amounts at the margins. It is astronomically high at the moment because there is a global excess of demand over supply.
Unless you run a global command economy, where some global Govt dictates who can have what, the consequence of excess demand over supply is that prices go up.
That's what has happened.
What we need to do is to prioritise addressing that excess demand, and a major issue there is that we all need to use less energy. Turn the thermostat down a bit. Turn lights off. Don't use the washer for a half load. Etc. Etc.
Using Govt money to subsidise prices reduces the stick that should be making us use less energy.
And here's the moral issue. If we do that, WE will be OK. We rich countries could afford to subsidise prices that our own people pay. But that won't reduce the cost of energy on global markets. And the poorest countries will be the ones f**ked over if global demand continues to outstrip supply. Because their Govts cannot subsidise their domestic prices.
As the IMF says, the correct way for rich countries to deal with this crisis is 100% not to subsidise energy prices (which is what the TUC campaign wants). If you call for that, don't claim to be a socialist who cares about the poor of the developing world.
The correct way is for rich countries to allow the price to be what the global market determines it to be. Use that as a stick to encourage people to use less. And give big benefit subsidies to help people pay the bills. Predominantly targeted at the very poorest. The richer people will just have to tighten their belts.
Funny times we live in. The IMF being more internationally socialist than the TUC.
Tell all that to the millions of people in THIS country who will be sat with quilts round them next Winter, and very little food in their bellies.
Sunak, Truss, and Keith would love that post you've just made.
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I can imagine what some people would be saying in February when the poorest in the UK are literally freezing to death in their homes.
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On energy bills.
The IMF has said today (quite correctly) that Govt subsidies to the price of energy is very much the wrong way to address this crisis.
You on the Left, listen to the whole argument before you automatically switch off.
The argument goes like this. The price of energy is now what it is. Nobody is fiddling it other than possibly small amounts at the margins. It is astronomically high at the moment because there is a global excess of demand over supply.
Unless you run a global command economy, where some global Govt dictates who can have what, the consequence of excess demand over supply is that prices go up.
That's what has happened.
What we need to do is to prioritise addressing that excess demand, and a major issue there is that we all need to use less energy. Turn the thermostat down a bit. Turn lights off. Don't use the washer for a half load. Etc. Etc.
Using Govt money to subsidise prices reduces the stick that should be making us use less energy.
And here's the moral issue. If we do that, WE will be OK. We rich countries could afford to subsidise prices that our own people pay. But that won't reduce the cost of energy on global markets. And the poorest countries will be the ones f**ked over if global demand continues to outstrip supply. Because their Govts cannot subsidise their domestic prices.
As the IMF says, the correct way for rich countries to deal with this crisis is 100% not to subsidise energy prices (which is what the TUC campaign wants). If you call for that, don't claim to be a socialist who cares about the poor of the developing world.
The correct way is for rich countries to allow the price to be what the global market determines it to be. Use that as a stick to encourage people to use less. And give big benefit subsidies to help people pay the bills. Predominantly targeted at the very poorest. The richer people will just have to tighten their belts.
Funny times we live in. The IMF being more internationally socialist than the TUC.
Tell all that to the millions of people in THIS country who will be sat with quilts round them next Winter, and very little food in their bellies.
Sunak, Truss, and Keith would love that post you've just made.
Why do you do this? Have you actually read what I said?
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On energy bills.
The IMF has said today (quite correctly) that Govt subsidies to the price of energy is very much the wrong way to address this crisis.
You on the Left, listen to the whole argument before you automatically switch off.
The argument goes like this. The price of energy is now what it is. Nobody is fiddling it other than possibly small amounts at the margins. It is astronomically high at the moment because there is a global excess of demand over supply.
Unless you run a global command economy, where some global Govt dictates who can have what, the consequence of excess demand over supply is that prices go up.
That's what has happened.
What we need to do is to prioritise addressing that excess demand, and a major issue there is that we all need to use less energy. Turn the thermostat down a bit. Turn lights off. Don't use the washer for a half load. Etc. Etc.
Using Govt money to subsidise prices reduces the stick that should be making us use less energy.
And here's the moral issue. If we do that, WE will be OK. We rich countries could afford to subsidise prices that our own people pay. But that won't reduce the cost of energy on global markets. And the poorest countries will be the ones f**ked over if global demand continues to outstrip supply. Because their Govts cannot subsidise their domestic prices.
As the IMF says, the correct way for rich countries to deal with this crisis is 100% not to subsidise energy prices (which is what the TUC campaign wants). If you call for that, don't claim to be a socialist who cares about the poor of the developing world.
The correct way is for rich countries to allow the price to be what the global market determines it to be. Use that as a stick to encourage people to use less. And give big benefit subsidies to help people pay the bills. Predominantly targeted at the very poorest. The richer people will just have to tighten their belts.
Funny times we live in. The IMF being more internationally socialist than the TUC.
Tell all that to the millions of people in THIS country who will be sat with quilts round them next Winter, and very little food in their bellies.
Sunak, Truss, and Keith would love that post you've just made.
Why do you do this? Have you actually read what I said?
Yes, I've read what you said, so I'll ask you a basic question, are the TUC and Mick Lynch wrong on all this?
This country's getting very close to civil disobedience. When it happens, you, Keith, and others need to decide which side you're on, because none of it's going to go away.
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Maybe the TUC but most likely not you Steve nor Tyke aye?
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SS.
Yes they are wrong in saying the answer is to keep fuel prices low.
And you are bang out of order suggesting that I'm advocating people being put into abject poverty. Why do you do that?
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
So definitely not you then Steve?
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SS.
Yes they are wrong in saying the answer is to keep fuel prices low.
And you are bang out of order suggesting that I'm advocating people being put into abject poverty. Why do you do that?
I didn't suggest anything of the sort. I'm just curious to know what you'd suggest to people who are freezing and almost starving to death, seeing as your answer is for people just to switch a few things off.
How can they switch off what they haven't got? I honestly don't think you've grasped what's coming next Winter.
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SS.
Why do you reply so aggressively when you haven't done me the courtesy of reading what I wrote? It's there in my first post.
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
So definitely not you then Steve?
Are you actually dafter than you already appear to be, or do you just not bother to read other people's posts?
What do you not understand about me joining "EnoughisEnough", or agreeing with the stance taken by Mick Lynch and the TUC?
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SS.
Why do you reply so aggressively when you haven't done me the courtesy of reading what I wrote? It's there in my first post.
OK then, I'll just ask a simple question. If the TUC and Mick Lynch have got this so wrong, what's going to be the endgame in all this, because their movement is just gathering more and more momentum. How is all this going to play out for the Labour Party and the next GE?
More importantly, when's Keith going to say something about it?
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
So definitely not you then Steve?
Are you actually dafter than you already appear to be, or do you just not bother to read other people's posts?
What do you not understand about me joining "EnoughisEnough", or agreeing with the stance taken by Mick Lynch and the TUC?
I just think on politics and support for the less well off people of the UK you're a bit mouth and no trousers Steve is all, nothing personal like, you just bash stuff out on the keyboard and let others actually do it, tell me what you do about it more than this?
Plus you get aggressive, do you ever read your posts the next day, this is a forum with a bit of banter on the side not letting off steam in the gym
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SS.
Why do you reply so aggressively when you haven't done me the courtesy of reading what I wrote? It's there in my first post.
OK then, I'll just ask a simple question. If the TUC and Mick Lynch have got this so wrong, what's going to be the endgame in all this, because their movement is just gathering more and more momentum. How is all this going to play out for the Labour Party and the next GE?
More importantly, when's Keith going to say something about it?
The answer is to put money into people's pockets through the benefit system. Just as I said in my first post.
Starmer has been calling for that for months.
Gordon Brown published a report yesterday calling for that.
It's quick. It's easy. It's affordable. Just needs the political will.
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
So definitely not you then Steve?
Are you actually dafter than you already appear to be, or do you just not bother to read other people's posts?
What do you not understand about me joining "EnoughisEnough", or agreeing with the stance taken by Mick Lynch and the TUC?
I just think on politics and support for the less well off people of the UK you're a bit mouth and no trousers Steve is all, nothing personal like, you just bash stuff out on the keyboard and let others actually do it, tell me what you do about it more than this?
Plus you have a lot of front accusing others of getting aggressive, do you actually read your posts the next morning.
Who did I accuse of being aggressive? What do I let others do?
I'm going to stop engaging with you now, because I honestly believe you've got a serious problem understanding the English language.
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I rushed that bit out, but by all means stop engaging with me because I ask you tough questions, I ask you what more do you do than just criticise others on here, please tell me you actually do something with all this pent up aggression Steve other than just rant about what you don't like?
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Maybe the TUC but most likely not you Steve nor Tyke aye?
You missed Albie out there, another one who cares about working class people and the poor.
So definitely not you then Steve?
Are you actually dafter than you already appear to be, or do you just not bother to read other people's posts?
What do you not understand about me joining "EnoughisEnough", or agreeing with the stance taken by Mick Lynch and the TUC?
I just think on politics and support for the less well off people of the UK you're a bit mouth and no trousers Steve is all, nothing personal like, you just bash stuff out on the keyboard and let others actually do it, tell me what you do about it more than this?
Plus you have a lot of front accusing others of getting aggressive, do you actually read your posts the next morning.
Who did I accuse of being aggressive? What do I let others do?
I'm going to stop engaging with you now, because I honestly believe you've got a serious problem or two.
I’ve amended your post Steve so that it is a bit more accurate.
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Pud,
Not sure what you think is tough.
The TUC produced a costed plan for public ownership of key utilities which was cheaper than not implementing it.
https://www.tuc.org.uk/news/tuc-publishes-plan-cut-bills-through-public-ownership-energy-retail
What about the idea of using the BULB customers as the base for a public sector energy provider, operating to a remit to lower consumer costs?
The big greed corps would need to price down to compete, or lose customers hand over fist.
Just one suggestion!
All the goals in the "Enough is Enough" programme are what Labour should be supporting anyway, but they just won't show any policies to be discussed.
https://inews.co.uk/news/new-union-and-mp-fronted-campaign-enough-is-enough-plans-to-hold-rallies-to-fight-cost-of-living-crisis-1784438
Albie claiming a plan is costed doesn't mean it is. To think you'd purchase all the energy companies for £2bn is ridiculous. Not only are you buying the shares (which you can't quantify in all cases it's all assumptions to fit the narrative, not withstanding the premium you'd have to pay) but taking on the debt, risks on future purchases (hedged or not), risks on customer default etc etc.
They use EDF as an example, just look at the debt that's causing on France and how much debt and risk the french government is taking on. (It's going to cost France north of £50bn) for a company losing money.
I largely agree with bst we do have to suck it up a bit, but clearly the calls to tax those like bp further are valid to an extent (with breaks for investment). The issue is not with your provider, as bst says the market dictated what they charge, nationalising that just passes the risk on to taxpayers.
Back to my point on labour at the start, they cannot commit to big money on this, it's just fiscally risky and inappropriate to do so. Labour have already committed to running daily spending on a balanced mechanism. They cannot possibly do that and nationalise energy companies.
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That's not actually correct BFYP.
If firms are nationalised, yes that costs cash money. But it also puts assets on the Govt balance sheet.
Done at the right value, the effect it has on the Govt accounts is absolutely neutral.
Govt IS going to have to subsidise the cost of living though and this is a separate issue. That will be either the wrong way (the French way) or the right way (increasing benefits). In principal the effect of each of those on Govt finances is equivalent. The relative efficacy of the methods is not measured by their cash cost. It is the effect it has on limiting pain at home without just exporting that to pain in the developing world.
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You'd do well to find many energy companies with assets greater than liabilities right now that's before you even consider the risks involved. Just look at the huge provision Centrica booked on their balance sheet as one example. There aren't a huge amount of assets in the energy companies given they are essentially just the provider of energy they purchase (likely with huge risk right now).
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Agreed. But that doesn't change the basic principle. If you nationalise a company by paying the correct market price taking into account all its assets and liabilities, the balance sheet of the Govt is unaffected. So you can nationalise companies without having any effect on the Govt balance sheet.
For what it's worth, I do think the energy companies will have to be nationalised if we are going to make the necessary green transition. I don't see market mechanisms doing that.
But that's a totally different issue to whether we need to nationalise them to sort out the immediate cost of living crisis. There are far quicker and more effective ways of managing that over the next few weeks and months. Whether this Govt will take those steps is another question entirely.
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You just need to send them an email and explain what they need to do and everything will be fine.
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Meanwhile, Truss has doubled down on saying she will sort this out through tax cuts.
How do tax cuts help the very poorest who need most help get through this?
What she's doing is offering most help to the well off who least need the help. I can't figure out whether she is utterly clueless or in fact an out and out class warrior.
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And if you're properly going to understand this crisis, who was and wasn't to blame and what can be done about it, this guy is, as ever, right on the money.
From 6 months ago.
https://mobile.twitter.com/t0nyyates/status/1489200245066059776
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Meanwhile, Truss has doubled down on saying she will sort this out through tax cuts.
How do tax cuts help the very poorest who need most help get through this?
What she's doing is offering most help to the well off who least need the help. I can't figure out whether she is utterly clueless or in fact an out and out class warrior.
Just to put this in perspective. Truss is saying she will cut NIcas soon as she's in No10.
The effect of a 1% cut in NI?
If you're earning £200 a week, it'll save you precisely zero.
If you're earning £300 a week, it will save you 50p a week.
If you're earning £1000 a week, it'll save you £7.60 a week.
If you're earning £2000 a week, it'll save you £17.50 a week.
If you're earning £10,000 a week, it'll save you £100 a week.
How in the name of heaven is that supposed to help the people who are going to be worst hit?
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Pud,
You are still assuming that a public investment would involve buying shares at current stock value.
This value has been artificially increased as a result of excess profits being channelled into buybacks.
You could just issue new equity to the equivalent of 51% of the current stock in a preferential public account.
100% equity control is not required.
After all, these shares were offered to the public at a discount way below their true value.
This has resulted in sell on to non UK interests, transferring profits off-shore to foreign profit seeking shareholders.
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What must it be like to be so irredeemably stupid, and have no comprehension of how stupid you are.
https://twitter.com/DanielJHannan/status/1556972438248103936?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet
Jesus wept. The sheer thickness of this man.
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Meanwhile Keith is waiting for the results of one of his focus groups that will tell him what to think .
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Pud,
You are still assuming that a public investment would involve buying shares at current stock value.
This value has been artificially increased as a result of excess profits being channelled into buybacks.
You could just issue new equity to the equivalent of 51% of the current stock in a preferential public account.
100% equity control is not required.
After all, these shares were offered to the public at a discount way below their true value.
This has resulted in sell on to non UK interests, transferring profits off-shore to foreign profit seeking shareholders.
Has that ever happened in the western world? Can it even happen in UK law? Do the shareholders of these companies deserve to lose out? And then given the companies don't make huge profits do we just take that hit through the public funds?
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Pud,
Please read my post properly.
With a 51% public holding, private shareholders with a minority 49% can retain their shares if they wish...they are not "losing out".
That is only one means, others can be put forward.
Are you saying that the current set up is working?....for the big 6 maybe, but not for consumers!
Takeovers happen all the time in the financial hubs, why not one for the public good instead of private gain?
The issue is one of principle....what does a modern energy system look like, and how does the UK achieve it at lowest cost.
Give us your take please?
The present system is clearly broken, and cannot be reformed to meet the needs of the fuel poor and to decarbonise without conflict, can it?.
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I’d have thought making it viable for people to work rather than rely on benefits would be preferable
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I’d have thought making it viable for people to work rather than rely on benefits would be preferable
The overwhelming majority of working age people in the country do work.
The problem is, very few people can budget for a sudden increase of £3000 per year in the cost of a basic necessity.
That would be very hard in any society. In one like we've had for the last 4 decades where so many people are only just above the breadline, it invites disaster.
The benefits I'm talking about are not (just) for those out of work. There will have to be massive Govt payments to people a long way up the earnings ladder if we are going to get through this.
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Meanwhile Keith is waiting for the results of one of his focus groups that will tell him what to think .
This gets to the nub of the problem for Labour.
https://mobile.twitter.com/ChristabelCoops/status/1557272019112284160
The solution to the cost of living crisis is going to have consequences.
You have two possibilities.
1) Govt borrows a LOT of money to fund benefits.
2) Govt increases taxes on the wealthier half of society to subsidise the poorer half.
Neither of those are politically cost free. They will upset some major proportion of the electorate.
And Labour knows what that can mean, because of the GFC.
In 2008, Brown's Govt did EXACTLY the right thing in borrowing heavily to keep the economy going. We avoided a Great Depression II because of that.
And what was the electoral result? Great celebrations from a grateful electorate? Like f**k. Labour were hammered over the borrowing issue. The Tories kept schtum during the crisis, vanished off the stage, let Labour deal with it, then screamed that they'd spent too much.
And people swallowed it. You still get people today insisting that Labour were profligate and that CAUSED the disaster.
That's politics. The problem is not the politicians. It's the understanding of the electorate. It sounds brutal, but there is literally nothing to be gained for Labour by proposing solutions on the scale that is required here. No solution is going to be cost free. And given that we have an electorate programmed (wrongly) to believe that the last Labour Govt spent money like a drunken sailor, or was a high-tax Govt on the aspirational, Labour proposing those sorts of solutions gives the Tories a free hit.
It's grim, it's not idealistic, it's not what I want politics to be about, but Labour is best served keeping its head down and letting the Govt deal with this shit.
Like I keep saying, Oppositions never ever win elections. Govts lose them.
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And this is how bad it could get.
https://mobile.twitter.com/alexwickham/status/1557019715951804416
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Pud,
Please read my post properly.
With a 51% public holding, private shareholders with a minority 49% can retain their shares if they wish...they are not "losing out".
That is only one means, others can be put forward.
Are you saying that the current set up is working?....for the big 6 maybe, but not for consumers!
Takeovers happen all the time in the financial hubs, why not one for the public good instead of private gain?
The issue is one of principle....what does a modern energy system look like, and how does the UK achieve it at lowest cost.
Give us your take please?
The present system is clearly broken, and cannot be reformed to meet the needs of the fuel poor and to decarbonise without conflict, can it?.
No I totally understood it. You essentially think it's fair to devalue shareholdings by 50% and legal to only offer new shares to the government. Is it?
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Pud,
Yes Pud, it happens every day in the City.
The shares would be revalued to the worth of the business under the new architecture, so far so normal.
What is interesting is that you presumably do not worry about hostile takeovers aimed at leveraging profits, but resist a public interest intervention to prevent profit taking away from social provision.
As I said, it is a matter of principle.
Once again, how do you suggest resolving the problem we face?
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Energy bills comparison;
https://pbs.twimg.com/media/FZvvJCDXwAANf0D?format=jpg&name=900x900
Why is that?
What is specific to the UK that makes this so hard?
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Energy bills comparison;
https://pbs.twimg.com/media/FZvvJCDXwAANf0D?format=jpg&name=900x900
Why is that?
What is specific to the UK that makes this so hard?
Because we 'took back control'. The Tory bas**rds are freed up to f**k over which ever way they like.
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Energy bills comparison;
https://pbs.twimg.com/media/FZvvJCDXwAANf0D?format=jpg&name=900x900
Why is that?
What is specific to the UK that makes this so hard?
An incredibly weak regulator and a government caught like a rabbit in the headlights.
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Energy bills comparison;
https://pbs.twimg.com/media/FZvvJCDXwAANf0D?format=jpg&name=900x900
Why is that?
What is specific to the UK that makes this so hard?
Most European Governments are subsidising the price of energy (or, in the case of France, they are insulated from the bulk of the gas price increase because they have a massive nuclear electricity capacity).
We will (unless the new PM wants a revolution on her hands) not be subsidising the price, but putting money into consumers' pockets to cover a hefty proportion of the increase.
As I explained earlier this week, ours is the more economically suitable and more morally correct approach. Assuming the new PM does it at the scale required.
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Given that the rich always benefit from a financial crisis, especially one the size of this, surely the best way forward for the tories is to give enough out to the better off workers in tax breaks (for GE votes) whilst making sure there is a recession for the very rich to do all their dirty dealing, including buying up cheaper homes to sell on when there's an upturn. Win win. Is it Sunak or Truss that have the perfect formula for this exploitation?
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BST,
Your posts show that you do not understand the energy economy.
Yes, the French do not depend upon gas for heating like the UK.
The task for the UK is to electrify heat asap, and decouple the cost of electricity from wholesale gas prices.
The nuclear history of France is why they have electrified home heating, but this over dependence is now coming home to roost;
https://www.theenergymix.com/2022/08/07/failing-french-nuclear-plants-drive-up-electricity-costs-as-heat-wave-cuts-production/
The nuclear sector would collapse without public intervention.
The basic point is that this is a supply crisis, not a demand crisis, although we can manage demand downwards with energy efficiency and home insulation.
You will find that out when Putin restricts supply in the heating season. The worst is yet to come.
Your claim that compensation via the benefits system is the best response shows that you do not know how that system works, and how many fall through the gaps.
I can give you a more detailed explanation of why your general economic theory is incorrect applied to energy markets if you wish.
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Albie.
You keep saying that I don't understand the energy issue, while studiously avoiding reading what I write on the subject.
You condescendingly tell me this is a supply problem.
I know. I've said that multiple times.
You dismiss the argument that subsidising prices is the wrong approach without even mentioning the core of the argument that I put forward in this very thread.
So I'll say it again.
If you subsidise prices, what is the mechanism by which you encourage reduction in demand? Because, if you don't reduce demand, in a world of limited supply, the global market price of energy remains exorbitantly high. In which case, what happens to developing countries who don't have the fiscal space to counter the high global costs?
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Now then. Here's Gordon Brown on the issue.
https://www.theguardian.com/commentisfree/2022/aug/10/tax-profits-freeze-energy-prices-bring-suppliers-into-public-sector-gordon-brown?CMP=fb_cif
Pretty clear cut, fair play really. Would argue his version of "bringing into the public sector" is questionable but better than nothing.
Rumour is Labour are finally going to say something of substance next week. I genuinely hope they step up to the plate, despite my extreme scepticism, because the country needs it.
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Theres no doubt about it, civil disobedience is just around the corner, we watch two MP’s to fight it out to be an unelected PM, while the current PM sits on his hands, has a party and a holiday while the Rest of the Country worry’s how they are going to pay the bills
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BST,
The idea that allowing UK prices to rise quickly to £4200pa on average will help reduce energy costs in low income countries is wishful thinking......Do you really think Russia is looking at it like this?
"in a world of limited supply, the global market price of energy remains exorbitantly high. In which case, what happens to developing countries who don't have the fiscal space to counter the high global costs?"
You are assuming a global free market in energy without constraints, this is far from reality, as the Russian supply restrictions show.
Countries will act to preserve their own interests, be that by energy export tariffs or other measures.
This is a highly customised international market with trade barriers, and a supply restriction which targets certain economies.
"If you subsidise prices, what is the mechanism by which you encourage reduction in demand?"
The problem is that supply is not constrained by demand, but by geopolitics.
It will continue to be restricted for this reason alone, the level of demand globally will not influence this in the near term.
Demand has already been reduced by folk at the sharp end...they have no more wriggle room.
Look at the current level of energy debt, at record levels and rising rapidly.
https://metro.co.uk/2022/08/10/cost-of-living-households-already-owe-1300000000-on-energy-bills-17157306/
The solution is to pay people more, freeze price rises and confiscate excess profits from the energy suppliers with a profits cap, and do this while bringing the whole sector back into public ownership......otherwise profit based inflation will transfer wealth to rent seekers abroad.
The strange thing is that you recognise the need to renationalise energy, but then argue "not now".
If some specific measures are not fully effective until a time lag has passed, go early, not late.
There is no better time to grasp the problem, delay just means more hardship for the vulnerable.
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Theres no doubt about it, civil disobedience is just around the corner, we watch two MP’s to fight it out to be an unelected PM, while the current PM sits on his hands, has a party and a holiday while the Rest of the Country worry’s how they are going to pay the bills
Looking at the poll responses here, I reckon there will be some non-civil disobedience as well. It's going to be brutal once the temperature starts to drop. And no one's doing anything about it.
https://www.independent.co.uk/news/uk/politics/energy-bills-sunak-truss-conservatives-b2141681.html
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Pud,
Please read my post properly.
With a 51% public holding, private shareholders with a minority 49% can retain their shares if they wish...they are not "losing out".
That is only one means, others can be put forward.
Are you saying that the current set up is working?....for the big 6 maybe, but not for consumers!
Takeovers happen all the time in the financial hubs, why not one for the public good instead of private gain?
The issue is one of principle....what does a modern energy system look like, and how does the UK achieve it at lowest cost.
Give us your take please?
The present system is clearly broken, and cannot be reformed to meet the needs of the fuel poor and to decarbonise without conflict, can it?.
No I totally understood it. You essentially think it's fair to devalue shareholdings by 50% and legal to only offer new shares to the government. Is it?
Shares are a gamble, if you want security buy gov't bonds, you cannot buy shares and then demand a never ending stream of dividends. You buy shares because presumably you want a higher rate than putting your dough in the bank, if the company struggles for what ever reason or goes belly up, that's the price you pay for the risk of a higher dividend.
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Albie
You are waving away my points with waffle.
The economics domestically is simple.
If prices for energy that our suppliers have to pay on global markets go up by £X, Govt can deal with this in two ways, which are fiscally identical (in their effects on Govt finances), and identical in the protection they give to consumers.
Govt can subsidise the price by £X.
Or it can give £X directly to consumers.
You insist that the first approach is the only one. You are wrong in that. And, as far as the domestic issue is concerned, here's the socialist reason why you are wrong.
Govt subsidising prices is a blunt instrument that, in absolute cash terms aids the millionaire more than it helps the minimum wage single parent. It effectively subsidises everyone, and the more energy you use, the bigger the subsidy. I cannot support that. I prefer the Govt spending to be targeted at those who most need it. You cannot do that by subsidising the price. But you can do it by putting up Universal Credit by £40-50 a week, and/or making Govt payments directly to poorer workers. These payments should taper off for higher paid people who can afford to take the hit without going into penury. THAT is the socialist way to deal with the issue.
Regarding excess profit taxes, you're lecturing me, not for the first time, on something I've been proposing for months.
Regarding nationalisation, I'm not saying "not now". I'm saying that is irrelevant to the IMMEDIATE price crisis. For what it's worth, I do think nationalisation sooner rather than later is needed for the green transition.
Regarding demand management, I assumed you would agree that all developed countries need to rapidly reduce their reliance on imported gas, both for environmental reasons, and to reduce reliance on Russian supply. How do we do that if we subsidise the consumer price? Where's the incentive to turn off lights and turn the thermostat down? As for the effect on global prices of a reduction in demand from developed countries, you are assuming that Russia's ability to squeeze global supply is unlimited. It isn't, if for no other reason than that they rely on that supply for their income.
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Here's the problem BST. During furlow we fell between the cracks and despite needing help recieved none. I saw friends in a better position than us receive the full furlow. In the event we muddled through, with the help of an inheritance that came through.
I know we'd be in a similar position with Sunaks targeted help this winter too. Sunak acknolwges this happens and just shrugs saying he's very sorry but he can't help everyone.
The French model of holding the cap down appeals far more to me, simply because it's comprehensive.
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RD
I'm sorry to hear that.
But this is a very different sort of crisis. Furlough was about keeping people in jobs. This is about matching what energy is going to cost with what people can afford.
It would be very easy for the Govt to run a -ve income tax for example, to give money to people rather than take it from them. This could be set at a high % for low earners, and taper off so that high earners get nothing and have to look after themselves. That would work for everyone registered as employed or self employed. For those not in work, UC could be increased to put money into their pockets. Similarly, anyone receiving a state pension could be given an increase.
The alternative means Govt subsidising the wealthy who can look after themselves. And at some point, we'll all have to pay for that, either in higher taxes or in lower state spending on schools and hospitals.
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Trust me BST, without going into details, I'm already seeing the cracks open up.
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Trust me BST, without going into details, I'm already seeing the cracks open up.
Yes, I agree. But that's because the Govt had tvtaken this remotely seriously. They haven't put in anywhere near enough money into subsidising incomes OR prices.
Johnson has f**ked off in a huff saying it's not his problem.
Truss and Sunak have refused to address this now. And Truss, who will win has said next month her policy will be a tax cut that gives someone earning half a million quid a year an extra £100 a week, and someone earning £10k a year precisely zero.
The problem there is not the principle of whether you subsidise prices or incomes. It's a total disengagement with the issue.
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It looks like this issue is going to be ongoing for the rest of this year and the majority of next before it tapers off.
I think i read somewhere that someone proposed a sort of quasi nationalisation where the state provided a controlled amount of energy to each household, with filtering for dwelling type and numbers of inhabitants. This controlled amount would be provided with the proviso that if you wanted any more you had to pay the market rate plus a surcharge for it. So the larger consumers who wanted more had to pay for the extra.This would prevent the real poor and OAP's from freezing to death this winter and allow us to get through this extraordinary period where as stated its going to get progressively worse this winter when Putin really turns the screw.
Would this be feasible to implement whilst also looking into doing the same with water supply's in the future and other required services.
Would this be a help to the large proportion who are going to genuially struggle to either eat or heat this winter?
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BST,
Your points.
The economics domestically is simple.
GAS MARKETS ARE COMPLEX, AND SUBJECT TO A MIX OF CONTRACT TYPES WHICH HEDGE FOR INFLATION AND SPOT MARKET VARIATION.
If prices for energy that our suppliers have to pay on global markets go up by £X, Govt can deal with this in two ways, which are fiscally identical (in their effects on Govt finances), and identical in the protection they give to consumers.
WRONG. THE IMPACT ON GOVERNMENT FINANCES IS VERY DIFFERENT.
A VERY IMPORTANT POINT IS TO LIMIT INFLATION ACROSS THE ECONOMY, AND ALLOWING THE PRICE INCREASE WILL DRIVE THAT UPWARDS…..THE OPPOSITE OF WHAT YOU WOULD WANT.
Govt can subsidise the price by £X.
Or it can give £X directly to consumers.
You insist that the first approach is the only one. You are wrong in that.
NO, I AM SAYING THAT IT IS BETTER TO PREVENT THE PRICE RISE (NOT SUBSIDISE, AS YOU INCORRECTLY SAY).
THIS IS TO MINIMISE THE INFLATIONARY EFFECT, WHICH HAS MAJOR IMPLICATIONS FOR TAX REVENUE IF BUSINESSES FOLD DUE TO ENERGY SHOCK AFFECTING THEIR VIABILITY.
And, as far as the domestic issue is concerned, here's the socialist reason why you are wrong.
Govt subsidising prices is a blunt instrument that, in absolute cash terms aids the millionaire more than it helps the minimum wage single parent. It effectively subsidises everyone, and the more energy you use, the bigger the subsidy.
YES, BUT YOU INTRODUCE PRICE CAPS IN COMBINATION WITH OTHER MEASURES, SUCH AS THE BASELOAD TARIFF.
NOBODY IS SUGGESTING YOU PRICE CAP WITHOUT OTHER MEASURES TO MITIGATE IMPACTS IN THE WIDER ECONOMY.
I cannot support that. I prefer the Govt spending to be targeted at those who most need it.
YES, I AGREE WITH TARGETING....THE BEST WAY TO DO THAT IS TO PREVENT THE PRICE CAP INCREASE, THEN ADDRESS FUEL POVERTY FROM A LOWER BASELINE OF CHARGES AND DEBT.
ALLOWING PRICES TO RISE, THEN LOOKING TO COMPENSATE WILL COST MORE TO RETROFIT, AND WILL NEED TO BE REPEATED.
BUT IT IS NOT JUST HOUSEHOLDS. BUSINESSES ARE ALSO AT RISK.
You cannot do that by subsidising the price.
YOU ARE NOT SUBSIDISING THE PRICE, YOU ARE CAPPING IT. THE ENERGY COMPANIES WOULD TAKE THAT HIT THEMSELVES FROM PROFITS.
But you can do it by putting up Universal Credit by £40-50 a week, and/or making Govt payments directly to poorer workers. These payments should taper off for higher paid people who can afford to take the hit without going into penury. THAT is the socialist way to deal with the issue.
NO, UC IS ACCESSED ONLINE AND CAPPED AT £16K SAVINGS, AND HAS AN EARLIER TAPER......MANY VULNERABLE PEOPLE FALL THROUGH THE NET WITH UC.
A SOCIALIST WOULD ABOLISH UC AS UNFIT FOR PURPOSE, AND WOULD NOT ALLOW THE PRICE CAP TO BE USED TO SUPPORT THE COMPANIES RATHER THAN CONSUMERS.
Regarding nationalisation, I'm not saying "not now". I'm saying that is irrelevant to the IMMEDIATE price crisis.
NO,THIS IS NOT A ONE-OFF. THE PRICE CRISIS IS A CONTINUING PRESSURE INTO THE MID TERM.
For what it's worth, I do think nationalisation sooner rather than later is needed for the green transition.
SO WHY NOT KILL 2 BIRDS WITH 1 STONE, AND DEAL WITH THE CLIMATE ISSUE AT THE SAME TIME AS THE ENERGY CRISIS?
Regarding demand management, I assumed you would agree that all developed countries need to rapidly reduce their reliance on imported gas, both for environmental reasons, and to reduce reliance on Russian supply. How do we do that if we subsidise the consumer price? Where's the incentive to turn off lights and turn the thermostat down?
THE PRICE SIGNAL HAS ALREADY MAXED OUT, AS THE RISING DEBT SHOWS. ADDITIONAL COST INCREASES HAVE A DECLINING IMPACT OVER TIME, NOT A RISING ONE.
DEMAND MANAGEMENT IS ABOUT A WHOLE RANGE OF TOOLS, SUCH AS DIFFERENTIAL PRICING OFFERING A BASELOAD TARIFF AT A LOW RATE, THEN SIGNIFICANT INCREASES IN UNIT COSTS ABOVE THAT MINIMUM CONSUMPTION.
As for the effect on global prices of a reduction in demand from developed countries, you are assuming that Russia's ability to squeeze global supply is unlimited. It isn't, if for no other reason than that they rely on that supply for their income.
NO, IT IS CLEAR WE ARE A LONG WAY FROM THE END.
PUTIN IS NOT MAKING CHOICES BASED UPON MAXIMISING INCOME.
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Albie.
You've actually given me pause for thought about whether I didn't get this. Not because of any argument you e put forward, but because you were so robust in insisting I didn't know what I was talking about. I did wonder if I was missing something.
Then this post.
Where on earth to start?
Let's start here. I think this gets to the core of things:
You cannot do that by subsidising the price.
YOU ARE NOT SUBSIDISING THE PRICE, YOU ARE CAPPING IT. THE ENERGY COMPANIES WOULD TAKE THAT HIT THEMSELVES FROM PROFITS.
This was a lightbulb moment for me. You actually think the first order problem is profiteering by the energy delivery companies don't you? You couldn't possibly have written this without believing that.
Let's explore that. You reckon we can tell the suppliers to keep prices down and just reduce their profits? How much shall we cap the price rise by? Given that we have 25 million households in the country, every £1000 you cap the price rise by adds up to £25bn.
You reckon supply companies can absorb that level of cost?
Or do you suggest that we somehow magically tell the extraction companies that we as a country are capping the price we will pay for gas? Good luck with that given that 50% of our gas comes from imports.
There is no possible escape from the fact that, if we want to protect consumers, that requires massive Govt subsidy to either suppliers or consumers. Claiming you can just pass a law that caps the price rise and that's that is so far wide of the mark, I'm genuinely astonished to here you say that.
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I fear the next PM is truly insane.
https://www.bbc.co.uk/news/uk-politics-62513966
If she thinks an NI cut is going to sort this out, there'll be riots like you've never seen by Xmas.
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I fear the next PM is truly insane.
https://www.bbc.co.uk/news/uk-politics-62513966
If she thinks an NI cut is going to sort this out, there'll be riots like you've never seen by Xmas.
just read this the woman has a screw loose and it in does help at all to people on low wages
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I fear the next PM is truly insane.
https://www.bbc.co.uk/news/uk-politics-62513966
If she thinks an NI cut is going to sort this out, there'll be riots like you've never seen by Xmas.
I honestly don’t think we are that far away from riots, the caretaker PM has washed his hands of the job, the two wannabe PM are pandering to the elite and the poor are facing destitution, something has to give!
Yes I’m a Labour voter, but honestly I don’t care who’s in power right now, I just want someone thats going to get a grasp of the situation, politics can wait for now, we’re on the brink of a national crisis. So far Gordon Browns plan is the only credible plan out there, I challenge anyone to find a better alternative
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I fear the next PM is truly insane.
https://www.bbc.co.uk/news/uk-politics-62513966
If she thinks an NI cut is going to sort this out, there'll be riots like you've never seen by Xmas.
I honestly don’t think we are that far away from riots, the caretaker PM has washed his hands of the job, the two wannabe PM are pandering to the elite and the poor are facing destitution, something has to give!
Yes I’m a Labour voter, but honestly I don’t care who’s in power right now, I just want someone thats going to get a grasp of the situation, politics can wait for now, we’re on the brink of a national crisis. So far Gordon Browns plan is the only credible plan out there, I challenge anyone to find a better alternative
I agree with you on this Filo.
For the life of me I can’t understand why Johnson stayed on as a caretaker manager.
The leadership thing should have been done much quicker.
They are taking longer than Rovers do to appoint a new boss.
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Filo,
Gordon Brown’s solution includes some good suggestions, but overall it makes little sense.
Brown seems to be saying is that the state should absorb energy company losses, and then restore them to private control when profits return.
That is a complete misunderstanding of the need to reform the sector in the public interest.
The current system will never work for the fuel poor, or be able to respond to climate breakdown.
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That old Tory conference British cheese speech showed off her loose screws. Though it also showed how as much as she is a wannabe Thatcher, she ain't. She hasn't got the same robot Iron Lady act, not nearly. There is some humanity in her beyond the insanity, as well as some ability to adapt. That could go any way, but she is someone who's instinct is to be liked, and that possibly - fingers crossed - is a general thing, she wants the country to approve of her, it's not just about pleasing her party or the establishment. And she will very much want to win the next election for herself as a feel good thing.
Sunak is just caught in so much slime of so much establishment corruption, he'd be a nightmare in this situation. Tories know this.
So I think Truss would be somewhat flexible to pressure from the population, though not directly wanting to be swayed by an "anarchist" movement.
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Filo,
Gordon Brown’s solution includes some good suggestions, but overall it makes little sense.
Brown seems to be saying is that the state should absorb energy company losses, and then restore them to private control when profits return.
That is a complete misunderstanding of the need to reform the sector in the public interest.
The current system will never work for the fuel poor, or be able to respond to climate breakdown.
I agree a long term solution is required, but the here and now needs addressing urgently, like I said can anyone come up with a credible alternative or are we going to let a lot of people freeze to death this winter?
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I sometimes disagree with Owen Jones, but this 2 minute video is on the right lines:
https://twitter.com/We_OwnIt/status/1558076187041316870?cxt=HHwWjIC-2a-Cs58rAAAA
Where are Labour and the silent knight?
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I sometimes disagree with Owen Jones, but this 2 minute video is on the right lines:
https://twitter.com/We_OwnIt/status/1558076187041316870?cxt=HHwWjIC-2a-Cs58rAAAA
Where are Labour and the silent knight?
They're all on holiday in Aussie, Albie, having a barbecue with Sydney Rover, the only friend they've got left.
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BST,
What you are suggesting, allowing prices to rise exponentially, will result in rampant inflation, leading to a massive recession including business failure and the loss of tax revenue to the public purse.
The issue is how the UK manages the available supply, and how the rising cost is mitigated in the interest of low income consumers AND the wider economy.
Your proposal sidesteps the main issue, which is energy sector reform....without this, we are just on a treadmill of reactions rather than grasping the need for a new UK framework for energy.
1)
"Or do you suggest that we somehow magically tell the extraction companies that we as a country are capping the price we will pay for gas? Good luck with that given that 50% of our gas comes from imports".
No, I am saying that the UK caps the price retail suppliers can charge consumers, subject to consumption levels, with a higher tariff kicking in ONLY above the base price when a set minimum has been exceeded.
This has got to happen anyway....kicking the can down the road makes matters worse.
2)
Existing contracts need to be honoured, as a matter of law.
No-one is suggesting reneging on contracted supply arrangements.
The UK supply is provided by private sector multinationals, like the big 6, in a commercial arrangement with contracted providers.
For the big boys, much of this supply is in house, but traded on international markets where price differentials allow profit taking.
The small operators, over 30 of which have gone bust, are re-sellers dependent upon the decision making of the big 6, who operate as a cartel in relation to government.
3)
You mention that the UK imports 50% of our gas.
Yes, mostly from Norway and the USA as (LPG). A small proportion comes from Russia (3 or 4%).
4)
We also export North Sea gas.
This gas is owned by the likes of British Gas, and is sold on international markets.
https://www.theecoexperts.co.uk/blog/uk-exporting-gas-despite-energy-crisis
Your plan would result in the big 6 further benefiting from the increase, with UK energy users paying much higher costs to see that expenditure moved outside the UK to international shareholders, including the French government amongst others.
5)
Without public ownership and integration of the supply, distibution and retail networks, this will continue until reserves are exhausted by 2030 or so.
The point about Russia is that reduced supply will impact future contracts, so countries will become more protectionist with export quotas and tariffs. This is likely to mean higher prices in the next medium term contract bids.
6)
So the UK is managing a situation that is changing rapidly, and in the context of rampant inflation.
Doubling down on energy prices is the strongest measure in the toolbox to limit inflationary pressure, and at the same time relieve fuel poverty. You can do neither with your plan to allow price cap rises without structural intervention.
7)
The people on the sharp end struggling to pay exorbitant energy costs are also under pressure from other cost of living increases.
Likewise businesses at the cliff edge of cost increases.
The proposed price support to consumers is paid to the energy suppliers, with a credit on bills. This is then recouped by higher unit costs in the mid term.....so it is no different to a interest free loan.
8)
As I have pointed out, you need a suite of measures working together, not one-off gestures.
Proposed changes to the overall price cap ceiling would be alongside reform of tariff charges to introduce a progressive taper.
See the link below.
9)
You could be taking the Bulb customers and transfer them to a new public service energy provider, offering a lower tariff than the big 6. This would put downward pressure on the big 6 to reduce unit charges in response, or lose customers to the public provider.
The new provider could look to change the relationship between bills heavy on consumption with those low usage customers whose bill is excessive because of standing charges.
Those with a higher percentage of their disposable income going on energy costs stand to gain more from progressive tariff reform.
10)
"There is no possible escape from the fact that, if we want to protect consumers, that requires massive Govt subsidy to either suppliers or consumers".
You refer to use of public money as subsidy, but that depends on how it is spent.
Subsidy is price support without reform.....investment is public funding directed to structural change of the energy sector, for long term benefit.
Consider the position of energy dependent companies working across national boundaries.
What is going to happen is that they will move production to the location where energy costs are capped lower than in the UK.
This has major implications for the UK economy....think about that!
The UK is not protecting consumers by failing to change how the system works.
The best way to address the IMMEDIATE crisis is by structural reform.
A more intelligent discussion of the options for UK energy market reforms is here from New Economics Foundation:
https://neweconomics.org/2022/07/keeping-bills-and-carbon-low-where-next-for-policy
The low hanging fruit are those actions which are relatively neutral to the public finances, but high impact on the vulnerable groups.
I suppose it is only relevant if you want to address the issue, rather than political point scoring.
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A better way of getting back at the energy companies without bringing untold grief on yourself.
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwicjPuMzsT5AhWIQEEAHVXKA9wQFnoECAMQAQ&url=https%3A%2F%2Fwww.scottishdailyexpress.co.uk%2Fnews%2Fuk-news%2Fbrits-urged-hurt-energy-companies-27706517&usg=AOvVaw31PjLLWFpkbdlOVi29TMrF
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Albie.
One at a time if you don't mind because you're your thing again of losing the big picture wood for the detail of the trees. In doing so, you're actually ignoring what I keep saying, not addressing it.
Big picture. I've said that one way or another, we only get through this crisis by Govt subsidising someone. Govt has to either subsidise the price the consumer pays, or subsidise the consumer who pays the price.
You keep ignoring that and saying there's a magic solution whereby Govt simply decrees that the price must be no more than X. Let's investigate that. Again...
If you cap the price that SUPPLIERS can charge consumers, while not having power to cap the price EXTRACTORS charge Suppliers, you put every single Supplier out of business. That may or may not be a strategic aim, but it's irrelevant to this issue. In that case, Govt would have to step in to take over the supply system. But it would still have to pay global market rates to the Extractors.
Now, perhaps we could insist that Extractors don't charge us the global market price. You could do that in the case of the UK North Sea extraction. How quickly you could deal with the legal issues when faced with a $1trn industry is a question, but let's park that.
The issue is that you still have 50% of our supply to find from non-UK suppliers. You are right that we don't import much from Russia, but that was nothing whatsoever to do with the point. Russia's supply restrictions have caused global market prices to rocket for everyone, not just for Russian gas. You think Norway is going to say to us "We can get 4 times the price for our gas by selling it in the world market, but because it's you, we'll give you the same price that you've told your North Sea suppliers to charge you"?
The fact is that at least half our gas is going to cost spectacularly more next year than it did a year ago. That is an unavoidable fact, even though you've avoided addressing it over and over again. The question is: how do we address that fact without pauperising 40% of the population? The answer HAS to involve massive Govt subsidies somewhere or other.
You want to subsidise the price (or you did a few days ago before you started claiming we could wave the issue away just because we want to).
I want to subsidise consumers, while, where we can, confiscating the unearned profits generated by this massive market failure.
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More thoughts on why we should be subsidising energy consumers, not prices.
Look at this analysis of what the impending costs are likely to be.
https://mobile.twitter.com/ianmulheirn/status/1558055849788145669
With no further assistance, after taking account of pay rises, and increased costs, the richest will be out of pocket by net £250 a month by next April. The poorest by about £150 a month.
Those figures correspond to only 4% of income for the richest tenth of the population, but nearly 20% for the poorest tenth.
If you subsidise gas and electric prices through Govt spending (and please Albie, accept that you're not going to do it any other way) then you will be giving more money to the richest than you will to the poorest. Because the richest generally have bigger homes and bigger energy usage.
The genuinely socialist thing to do is not to subsidise prices, but to target assistance to this who are worst hit, by pouring money into their pockets. The richest 10-30% can take the hit without ending up on the street or freezing in their beds. It would be criminal to subsidise them rather than target assistance at the poorest.
There's another issue.
I'm currently paying 18.7p/kWh for electricity on a deal that expires in 8 weeks. I've been quoted 60-70p/kWh from October.
At 60-70p, it's a no brainer that I get solar panels and a battery. If the price of electricity is subsidised by Govt and capped at around 20-30p/kWh, it doesn't make financial sense for me to make that investment. Even though it is the thing I SHOULD be incentivised to do.
Subsidising prices is just wrong, wrong, wrong on SO many levels.
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Oh dear, BST,
Read my post,and the NEF link, you have not understood it at all.
The energy crisis feeds into a wide range of related issues.
Address the main point, avoiding inflation and crashing the economy.
I think I understand your position.
You are opposed to cost of living wage increases, because they would be inflationary...as you told us when Andy Macdonald resigned.
You support energy prices rising, despite this being inflationary, as long as the poorest get a bit of a leg up.
You reckon there is no problem with this going straight to the big 6, as long as a one-off windfall tax takes some back.
You think the UK will need the same gas imports next year, so the coming price rise from that will be dealt with in the same way.
Gradual tweaks are the way to sort out the energy crisis, don't upset the system which caused it to come about.
Russia will have an impact on future contracts. Existing contracts will need to be honoured, as I explained.
"You want to subsidise the price (or you did a few days ago before you started claiming we could wave the issue away just because we want to)".....exactly the opposite of what I said.
I want to avoid subsidy, by capping the price at the current level.
The big 6 are nowhere near bankrupt, as you imply.
The big 6 companies have a vertical business model, so the generators and distributors are the same company - just badged differently, like British Gas and Centrica.
Some smaller companies will fail (they need to) , so put their customers in a public interest company.
Alongside that the tariff structure needs a complete overhaul, as I explained.
The UK could address the inequality disparity between consumers with a “social tariff” as I suggested.
More detail in the NEF link.
Public money is needed, but not to support price increases, to reform the sector.....investment in a public infrastructure.
"The issue is that you still have 50% of our supply to find from non-UK suppliers".
That would be from a much reduced overall quantity of imports. The percentage is less important than the amount needed.
"The question is: how do we address that fact without pauperising 40% of the population?”
by reducing imports, using North Sea gas in the UK (via export quota restrictions), and electrification.
Rapid electrification reduces the need to import gas, and you do that at the same time as retaining North Sea supplies for domestic use in new contracts. Electrification of industry, buildings and transport to the full potential would reduce final energy demand by 40%.
The scale of the likely hardship problem is much larger than you suggest.
Some argue 66% of UK households will be in fuel poverty (to differing degrees), by this winter heating season.
The plan you suggest supports the industry more than the consumer or the UK economy in general.
Following your plan, many more people will be in fuel poverty by the end of this winter.
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This in today's Sunday Times. I advocated something similar a few months ago:
ScottishPower chief executive Keith Anderson has an interesting suggestion, though — one he first made in April, before Sunak’s initial £15 billion support package blew everything else away.
At Thursday’s summit, Anderson proposed freezing bills at £1,971 for two years. Suppliers would cover the gap between this and the wholesale price by borrowing from a “deficit fund”, underwritten by the state but filled with loans from the likes of Barclays.
Suppliers would repay the fund over 10 to 15 years, passing at least some of the cost onto consumers in that time. Taxpayers wouldn’t be on the hook other than the government guarantee, unless it was decided to cover the costs progressively, through general taxation.
Crucially, the plan would soften the impact on suppliers, too. Regulator Ofgem is worried about the sector after 30 collapses, as seen in its decision this month to update the price cap quarterly and make the way it is calculated more favourable to energy companies.
The proposal would give ministers and industry a two-year breathing space to redesign the market. ScottishPower is not alone in pushing it: Eon raised a similar proposal at Thursday’s meeting.
Now will someone please explain to me why this can't be actively progressed as a solution? And before anyone pipes up, I'm not accepting the following reasons:
- it would need state backing
- Johnson or Zahawi can't be arsed
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Looks like owd Keith has been cajoled into going for first base, and is leaving BST to stew in his juices;
https://www.theguardian.com/business/2022/aug/13/keir-starmer-demands-ban-on-raising-energy-prices
That is just a start, so lets wait for the rest of it and see if it adds up.
Social tariffs are a must...c'mon Keith, just say it....you can make it a "pledge" like those you put up for the leadership campaign!
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Albie.
Starmer calling for a cap freeze doesn't change my take that it's a sub optimal answer. But it's a damn sight better than the PM candidates are proposing.
For me, in ascending order, the most-to-least bad solutions are:
1) Do nothing. Let the market decide what the price is and who can pay: That will lead to massive destitution and revolution.
2) Let the market decide the price and give tax cuts. Only helps those paying tax. The poorest go to the wall as do many less affluent income tax payers. This is Truss's current plan.
3) Cap prices. That requires big Govt borrowing and disproportionately subsidises the wealthy who use more energy.
3a) As above with confiscatory taxes on the profits of the extractors and suppliers. But those taxes will never cover the cost of capping prices. If you don't accept that, there's no sensible discussion to be had.
4) Subsidise consumers against the global market costs. That subsidy can be directed at the most vulnerable and not used to bail out those who can look after themselves. It also massively incentivised energy efficiency and non-gas energy production. It should go without saying (but I obviously do have to say it as you've somehow convinced yourself I think otherwise) that this should go hand in hand with massive confiscatory taxes on the excess profits of the producers, for as long as the global market remains so hugely distorted.
So yeah, I don't think Starmer's plan is optimal. But I'll take it as a better than the Tory alternative.
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I sometimes disagree with Owen Jones, but this 2 minute video is on the right lines:
https://twitter.com/We_OwnIt/status/1558076187041316870?cxt=HHwWjIC-2a-Cs58rAAAA
Where are Labour and the silent knight?
They're all on holiday in Aussie, Albie, having a barbecue with Sydney Rover, the only friend they've got left.
Hope they're enjoying themselves Steve, Syd's in Sweden having a great time.
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BST,
Energy retailers actually buy 'energy futures'. They estimate much energy they will need for next winter and agree a price now, which may be well over (or under) the real price when the energy is used.
Smaller suppliers are re-sellers skimming the margin, and those energy supply companies that went bust had weak hedging strategies.
The rise in wholesale prices exposed their business model. Because they could not meet their contracted supply obligation at the agreed tariff, all UK consumers ended up paying to cover the gambling debts.
"Cap prices. That requires big Govt borrowing and disproportionately subsidises the wealthy who use more energy."
No, it depends on what else you do.
The UK could use the retail price structure to apply a progressive taper to consumption.
The UK needs to be a 2 or 3 tier pricing system. First tier up to say 90% of average consumption at a low cost, then a high cost for all energy over the 90% threshold, ramped up further for very high domestic consumption.
"As above with confiscatory taxes on the profits of the extractors and suppliers. But those taxes will never cover the cost of capping prices. If you don't accept that, there's no sensible discussion to be had."
You are making a false assumption about the difference between the two sides of the industry.
The energy companies like BP, British Gas and Shell operate a separate retail arm, and they sell the gas to themselves.
The retail side makes little or no profit ( and pays little tax ) the extraction/supply side makes the massive profits, but offsets tax liability on exploration costs.
This is why the Sunak "windfall tax" was such a scam, giving a 91p in the £ discount for further fossil fuel exploitation.
Capping retail prices is very different to capping profit on the exploration side.
The cost of exploration and extraction of reserves should not be rising in a mature industry.
You need a structure which does not incentivise restriction of supply as a method of inflating profit levels and profit taking.
The plan you support does nothing to address this problem.
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Rest easy, everyone.
The matter is in hand;
https://www.independent.co.uk/news/business/news/uk-blackouts-energy-crisis-b2144109.html
Good job we have a friend in uncle Vlad to keep an eye on us.
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The problem on this windfall tax policy though is just how do you claw that money from overseas? You can only take the money from UK activities.
I'm intrigued as to how Labour's fully costed plan is fully costed that will be worth evaluating.
I don't think a blanket cap on the price is right for the reasons BST mentions. Actually what I'd do is have a cap to a certain level of usage, so tiered pricing, the more you use the higher your unit price over certain levels. That then helps the poorest most meaning those with significant usage pay proportionately more.
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A windfall tax is just that a temporary measure and it allows the money to be used to support those struggling with their bills. One company has already stated it won't affect investment and where money is to be made companies don't hold grudges they will invest where they can make it.
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A temporary measure is not the answer, Syd.
The rise in gas prices will continue, so the UK needs to respond to that by revising how the industry works. We want the sector to change investment priorities, from fossil fuels to renewables, but they will continue with business as usual under the current arrangements.
The IPPR have produced a blog on the economics of a price cap freeze;
https://www.ippr.org/blog/freezing-the-energy-price-cap-could-fight-inflation-and-support-households
The price cap is a first step, which only has traction if the other measures are introduced (see my posts above)......Keith has not committed to the supporting measures today, which is a big mistake.
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Didn't say it was Albie, just a temporary measure
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A temporary measure is not the answer, Syd.
The rise in gas prices will continue, so the UK needs to respond to that by revising how the industry works. We want the sector to change investment priorities, from fossil fuels to renewables, but they will continue with business as usual under the current arrangements.
The IPPR have produced a blog on the economics of a price cap freeze;
https://www.ippr.org/blog/freezing-the-energy-price-cap-could-fight-inflation-and-support-households
The price cap is a first step, which only has traction if the other measures are introduced (see my posts above)......Keith has not committed to the supporting measures today, which is a big mistake.
If that analysis is correct, the authors deserve a Nobel Prize because they've just reinvented economics.
There is no mechanism whatsoever whereby increasing Govt defecit spending can reduce inflation. Claiming there is is the exact equivalent of a physicist saying putting rocks in a balloon will make it float better.
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1.2 million people in the uk earn over 100,000.
Take away their 12500 tax allowance.
That’s an extra 2500 tax they pay each per year.
Do it for two years. They can afford it.
There’s 6 billion quid straight away.
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1.2 million people in the uk earn over 100,000.
Take away their 12500 tax allowance.
That’s an extra 2500 tax they pay each per year.
Do it for two years. They can afford it.
There’s 6 billion quid straight away.
The personal allowance tapers by £1 for every £2 earned above 100k already...so by the time you earn approx 125k your allowance is zero (notwithstanding salary sacrifice, etc etc)
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BST,
The UK does not have to fund these measures by further borrowing, it can be done by incorporating into the progressive tax base.
It is possible to have a steeper progressive tax taper.
This is in addition to an excess profits cap, rather than a one-off windfall tax.
If you recognise the need to reorganise the energy industry, this route would be preferable.
Unfortunately, Labour have not understood the issue beyond the impending price rise.
No mention of a social tariff, with a tiered charging structure.
No position on the decoupling of electricity prices from wholesale gas prices.....these things are easy changes without a hefty price tag.
Keith is really just acting as a political prompt to the new Tory leader.
If he manages to move Truss that is of value, but there is a risk that the Tories will pull the rug from under him in September.
The lack of coherent thinking and policy from both parties means that the crisis will just drift on, to the disadvantage of the fuel poor.
The TUC position is here;
https://www.tuc.org.uk/research-analysis/reports/fairer-energy-system-families-and-climatesition
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1.2 million people in the uk earn over 100,000.
Take away their 12500 tax allowance.
That’s an extra 2500 tax they pay each per year.
Do it for two years. They can afford it.
There’s 6 billion quid straight away.
The personal allowance tapers by £1 for every £2 earned above 100k already...so by the time you earn approx 125k your allowance is zero (notwithstanding salary sacrifice, etc etc)
You are missing the point. Those that earn over 100k pay nothing on their first 12500 like the rest of us. Take that allowance away. The govt would get an extra 2500 in tax from them by virtue of 20% of that 12500.
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At the moment, the only opposition to the Government on this issue is Gordon Brown.
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
He got the idea from Brown anyway.
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Albie
"The UK does not have to fund these measures by further borrowing, it can be done by incorporating into the progressive tax base.
It is possible to have a steeper progressive tax taper."
I'm sorry but that's just word salad.
Who are you going to tax? By how much?
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
He got the idea from Brown anyway.
And the only stumbling block is he is not running the country
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
He got the idea from Brown anyway.
And the only stumbling block is he is not running the country
Perfect example from Hound here of how f**ked our Democracy is at the moment.
Labour has explained where the full £30bn of its plan comes from.
You can argue whether it is reasonable.
You can argue whether it is fair.
You can argue whether it makes economic sense.
You can argue whether it's the most optimal solution.
But if you insist that they haven't even explained their numbers, you might as well give up, because you're in an alternative universe of different facts.
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
Yes he did:
£14 billion from scrapping the £400 government handout to all households
£3.5 billion from extension of current windfall tax on energy producers
£4.7 billion in higher tax and vat tax on oil & gas sales
£7.2 billion saved from debt repayment by keeping interest rates down
it's here:
https://www.bbc.co.uk/news/62552464
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At the moment, the only opposition to the Government on this issue is Gordon Brown.
Well it's hardly you and your chum Steve is it, unless you have a political remote and can do it from the couch
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
Yes he did:
£14 billion from scrapping the £400 government handout to all households
£3.5 billion from extension of current windfall tax on energy producers
£4.7 billion in higher tax and vat tax on oil & gas sales
£7.2 billion saved from debt repayment by keeping interest rates down
it's here:
https://www.bbc.co.uk/news/62552464
Stopping that £400 handout will go down like a lead ballon.
No wonder he didn’t mention it in the interview I saw.
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1.2 million people in the uk earn over 100,000.
Take away their 12500 tax allowance.
That’s an extra 2500 tax they pay each per year.
Do it for two years. They can afford it.
There’s 6 billion quid straight away.
The personal allowance tapers by £1 for every £2 earned above 100k already...so by the time you earn approx 125k your allowance is zero (notwithstanding salary sacrifice, etc etc)
You are missing the point. Those that earn over 100k pay nothing on their first 12500 like the rest of us. Take that allowance away. The govt would get an extra 2500 in tax from them by virtue of 20% of that 12500.
Sorry but no, I'm not. Those that earn over 100k do not "pay nothing on the first 12500 like the rest of us", they have their personal allowance taken away at a rate of £1 per £2 earned, resulting in a marginal tax rate of 60% for everything earned between 100k and 125k. If you earn 110k, your personal allowance is not 12500, it's 7500. If you earn 120k it's 2500. if you earn 125k it's 0.
https://www.gov.uk/income-tax-rates/income-over-100000
https://taxscouts.com/high-earner-tax-returns/what-are-the-tax-implications-of-earning-over-100k/
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I stand corrected.you are right. When did this change come in?
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Starmer has said that he would keep the current energy price cap instead of allowing the proposed increases.
His plan would allegedly cost £29billion.
He told us where £8billion of that would come from but didn’t mention anything about the other £21billion.
Yes he did:
£14 billion from scrapping the £400 government handout to all households
£3.5 billion from extension of current windfall tax on energy producers
£4.7 billion in higher tax and vat tax on oil & gas sales
£7.2 billion saved from debt repayment by keeping interest rates down
it's here:
https://www.bbc.co.uk/news/62552464
Stopping that £400 handout will go down like a lead ballon.
No wonder he didn’t mention it in the interview I saw.
The £400 handout was to cover the rise from 1st October. Under Starmer's plan there will be no rise on 1st October.
Supported by 75% of all voters and 75% of Tory voters according to YouGov:
https://twitter.com/YouGov/status/1559197050037846017
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I stand corrected.you are right. When did this change come in?
April 2010 according to wiki.
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BST,
"Who are you going to tax? By how much?"
Your question has been answered several times already....energy production companies (the big 6) via an energy profits cap (permanent, not a temporary windfall tax), and high gas consumption via tiered pricing structures.
A national crisis needs an early and direct response.
Take whatever is needed to fund the transition to electricity production, and use for home heating.
How much depends on the companion measures you take to support the strategy.
See 155 above.
You can also change the income tax bands to take a higher proportion contribution from the wealthy, and allocate that sum to the energy solution.
Folding the costs into the general tax burden takes advantage of the progressive taper.
Why are Labour paying compensation to energy retailers?
Companies are subsidised to reduce bills, rather than taken into public ownership or part-nationalised through equity financing (Government taking shares in exchange for loans or subsidy). That support will be passed on (in part at least) to shareholders.
Propping up an inefficient and failing system is counter productive.
You could save the waste of money that goes into propping up failing companies like Bulb, and redirect those funds.
Why the public purse is keeping them on life support is a mystery.
If you are re-locating the energy retail sector into the public hands, the UK could remove standing charges, which are a no consumption premium tax.
Taking energy into public ownership would mean we emerge from the crisis holding revenue-generating assets.
Starmer has left the door open for the Tories to undermine him by introducing social tariffs.
They are doing this for broadband, and Labour should have read the runes on this.
This is a no brainer for a Labour policy, but Keith is either just too timid, or very poorly advised....I think it is both!
There is no policy for small commercial users, many of whom will go to the wall in an inflationary spiral.
At some point you are going to have to face up to the fact that neo liberal economic theory just doesn't cut it.
Labour needs to think like a socialist organisation, and stop playing tinkerman.
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BST,
"Who are you going to tax? By how much?"
Your question has been answered several times already....energy production companies (the big 6) via an energy profits cap (permanent, not a temporary windfall tax), and high gas consumption via tiered pricing structures.
And as I've said, over and over again, that doesn't sole the problem.
Half of our gas comes from abroad. We cannot dictate the price for that gas (because the suppliers will sell it to Germany for $x/m^3 if we only offer to pay half that). And we cannot tax companies that aren't British or operating in Britain.
You could (and I think, should) confiscate ALL the excess profits of British gas extractors and you'd still only have enough money to subsidise half of our gas.
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Incorrect, I'm afraid, Billy.
The UK does not require a fixed volume of gas going forwards, demand is subject to change as well as supply.
If the UK severs the link between gas and electricity prices, making leccy cheaper, some demand will transfer over.
If the UK reserves future North Sea gas for domestic use, via energy export tariff or levies, then the import requirement reduces.
Do both of these, and you are dealing with a net reduction in gas demand.
This reduction will increase over time, as heating system costs for electric decline with scale.
The aim is for the UK to need a lower percentage import for a reduced total demand.
Talking about the current percentage of gas imports misses the point by a mile.
What matters is the total amount required that is not covered by existing contract commitments....in other words, the future exposure to international wholesale fluctuations.
Some short term deficit funding is fine, provided that it goes into reforming the system rather than supporting higher unit charges and zombie suppliers.
Labour got to first base with the price cap, then failed to double down on the possibilities that the price cap enables...completely brain dead!
Public services such as the NHS and schools have no budget for these increases, and will not be able to meet these costs.
Still waiting to hear BST how you plan to prevent inflation from spiralling, and resolving the existing energy debt problem.
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That’s a really good idea BST confiscate profit from companies investing in the UK
That will really improve the economic plight we are in and make the UK an attractive place to invest
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That’s a really good idea BST confiscate profit from companies investing in the UK
That will really improve the economic plight we are in and make the UK an attractive place to invest
Well someone is going to have to pay Phil because as sure as it's Monday tomorrow a massive amount of people simply aren't going to be able to pay their bill .
The amount of small businesses who are going to go under will be catastrophic because they aren't covered by the cap .
I read the other day that a modest fish n chip shop if they passed the extra costs on to the customer would see them charging £9 for a bag of chips .
If something doesn't give and pretty sharpish it's proper going to go up on the streets in this country .
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Yep, they'll have to back to lard
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Still no significant change from the political class.
Truss/Sunak playing to the golf club gallery, talking about removing green levies, as though that is remotely a good response.
Keith/Reeves still reciting their windfall tax mantra, despite it being blindingly obvious that it is completely inadequate.
How did we come to be in hock to these nonentities?
What really annoys me is that Labour are leaving themselves exposed to a Tory reaction once Truss is in place, and then they will be playing follow my leader yet again.
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Still no significant change from the political class.
Truss/Sunak playing to the golf club gallery, talking about removing green levies, as though that is remotely a good response.
Keith/Reeves still reciting their windfall tax mantra, despite it being blindingly obvious that it is completely inadequate.
How did we come to be in hock to these nonentities?
What really annoys me is that Labour are leaving themselves exposed to a Tory reaction once Truss is in place, and then they will be playing follow my leader yet again.
By how much is it completely inadequate Albie?
Since Labour announced their figures gas prices have increased a further 40% and electricity futures reached a record high today. That means the gas and electricty supply companies who have been making £billions so far this year for entirely no extra cost will also see another big rise in their windfall profits.
https://www.reuters.com/markets/europe/new-shock-european-markets-gas-price-spike-fuels-inflation-fears-2022-08-24/
https://www.france24.com/en/economy/20220826-europe-s-electricity-prices-hit-record-high-as-supply-cuts-begin-to-bite
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Wilts.
But our next PM has said it is socialist error to tax profits. She's totally ruled out a windfall tax.
Remember that when the Govt has to borrow billions to help people survive the winter. That borrowing will be directly subsidising BP and Shell profits. And we'll all have to pay that off for years.
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Wilts,
We know the medium range and longer term forecasts, and we know that some of the uncertainties around those indicate a worsening rather than relief.
Labour should have known the limits to their policy at the time it was promoted. It was nothing like sufficient then, and to not move forwards with an alternative is complacent and shows a deep lack of understanding of the energy economy.
It is less a question of "how Much", and more a question of "as much as it takes". In the wake of that commitment you also look to reform the industry to reflect the public interest.
It is completely inadequate to keep reciting a policy formula which will not address any of the structural issues.
Reeves was interviewed on the BBC and kept to the obsolete script like a bot, without any grasp of what is needed.
There is no public interest in shoring up the privatised energy sector, which is just a channel to syphon off resources to shareholders.
Labour seem to think a 6 month plan to preserve the present framework is adequate....it falls so far short that it really will not touch the sides of a major economic meltdown.
Nothing for example on social tariffs, or on separating the energy pricing of electricity from gas wholesale.
No plan to set up a public supplier at cost, focussed on renewables.
The point is that Labour need to get on the front foot, and start the conversation about change.
There is low hanging fruit to be picked, and Labour are just waiting for the Tories to pick it.....really poor political positioning, as well as tokenism on the everyday cost of living question.
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Wilts,
We know the medium range and longer term forecasts, and we know that some of the uncertainties around those indicate a worsening rather than relief.
Labour should have known the limits to their policy at the time it was promoted. It was nothing like sufficient then, and to not move forwards with an alternative is complacent and shows a deep lack of understanding of the energy economy.
It is less a question of "how Much", and more a question of "as much as it takes". In the wake of that commitment you also look to reform the industry to reflect the public interest.
It is completely inadequate to keep reciting a policy formula which will not address any of the structural issues.
Reeves was interviewed on the BBC and kept to the obsolete script like a bot, without any grasp of what is needed.
There is no public interest in shoring up the privatised energy sector, which is just a channel to syphon off resources to shareholders.
Labour seem to think a 6 month plan to preserve the present framework is adequate....it falls so far short that it really will not touch the sides of a major economic meltdown.
Nothing for example on social tariffs, or on separating the energy pricing of electricity from gas wholesale.
No plan to set up a public supplier at cost, focussed on renewables.
The point is that Labour need to get on the front foot, and start the conversation about change.
There is low hanging fruit to be picked, and Labour are just waiting for the Tories to pick it.....really poor political positioning, as well as tokenism on the everyday cost of living question.
I agree Labour need to get on the front foot and lead the conversation. I would like to see them push for nationalisation of all public utilities - but thats not going to happen under a Tory government.
Labour have put a costed plan forward to assist people with their engery bills this winter. Since they put the plan forward the amout they would raise from a windfall tax has risen.
You said this was totaly inadequate. There is no point playing fantasy politics in a crises. Why is what Labour have proposed the Tories should do now - immediately - totally inadequate?
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Didn't corbyn throw the kitchen sink at the last election, how did that go down Albie?
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Wilts,
I answered your point in the previous post;
"Nothing for example on social tariffs, or on separating the energy pricing of electricity from gas wholesale.
No plan to set up a public supplier at cost, focussed on renewables".
The windfall tax will not cover the need to reform the sector.
Leaving the system untouched means that the zombie companies will remain on life support, kept going by higher prices but adding no value to the system economics.
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At last, a challenge to the useless regulator Ofgem in the courts;
https://twitter.com/GoodLawProject/status/1563146547834957824
Lets hope this succeeds, and they are forced to produce an impact assessment of their proposals.
It is beyond belief that we could have reached this point without a forward assessment of wider impacts.
How can Ofgem claim to be acting in the interests of consumers if they have not even conducted (and published) this analysis?
It also shows how poor the response has been from politicians that they have not requested this information from Ofgem themselves.
The "Don't Pay" campaign will have more solid grounds for their position if Ofgem are found to have failed to follow due process.
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At last, a challenge to the useless regulator Ofgem in the courts;
https://twitter.com/GoodLawProject/status/1563146547834957824
Lets hope this succeeds, and they are forced to produce an impact assessment of their proposals.
It is beyond belief that we could have reached this point without a forward assessment of wider impacts.
How can Ofgem claim to be acting in the interests of consumers if they have not even conducted (and published) this analysis?
It also shows how poor the response has been from politicians that they have not requested this information from Ofgem themselves.
The "Don't Pay" campaign will have more solid grounds for their position if Ofgem are found to have failed to follow due process.
Reported on Novara Media yesterday too .
https://youtu.be/o2jOmL828GM
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I also understand the Trade Unions are coordinating industrial action and forming what could probably be described as an Alliance to achieve the maximum impact with their demands .
This action isn't to be mistaken for secondary picketing which of course is illegal .
I also understand a day of action is planned for Saturday October 1st by " The Enough Is Enough " campaign across the major cities .
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At last, a challenge to the useless regulator Ofgem in the courts;
https://twitter.com/GoodLawProject/status/1563146547834957824
Lets hope this succeeds, and they are forced to produce an impact assessment of their proposals.
It is beyond belief that we could have reached this point without a forward assessment of wider impacts.
How can Ofgem claim to be acting in the interests of consumers if they have not even conducted (and published) this analysis?
It also shows how poor the response has been from politicians that they have not requested this information from Ofgem themselves.
The "Don't Pay" campaign will have more solid grounds for their position if Ofgem are found to have failed to follow due process.
Goodlawproject, great organisation.
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I don't know in what form it will take, but there's definitely some sort of revolution coming.
This situation we're all in now just isn't sustainable.
If the establishment can't see this, they're in for a f*cking surprise.
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I don't know in what form it will take, but there's definitely some sort of revolution coming.
This situation we're all in now just isn't sustainable.
If the establishment can't see this, they're in for a f*cking surprise.
There's defiantly more than a hint of the powers that be for want of a better term are so detached from its people they are literally sleep walking in to what could potentially be civil disorder on a scale not seen since 1990 .
The trick of course was always to just about give enough to enough people to keep them from going on to the streets .
We are extremely close to that not happening .
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don't you just love it from the herd, labour labour labour blah blah blah, please give examples, blah, bla, bl, b, 0.
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don't you just love it from the herd, labour labour labour blah blah blah, please give examples, blah, bla, bl, b, 0.
What on Earth are you blathering on about?
FFS, Syd, take some Diazepam.
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don't you just love it from the herd, labour labour labour blah blah blah, please give examples, blah, bla, bl, b, 0.
What on Earth are you blathering on about?
FFS, Syd, take some Diazepam.
if you don't know why are your knickers in a twist again?